Transfer Pricing

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In line with new developments in BEPS and the OECD regarding transfer pricing, both the IRS and CRA are increasing their scrutiny of cross-border transactions between related parties.

As a result, small and medium-sized businesses are experiencing an increase in transfer pricing audits.

Our methodology is to group transfer pricing transactions into the following general areas:

  • Intangible payments, such as royalties
  • Management and administration fees
  • Intercompany loans
  • Sale of products

Our experience is that the IRS and CRA have focused primarily on the first three areas when performing transfer-pricing audits. The CRA is applying the OECD guidance and requires companies to establish transfer pricing agreements that conform to OECD transfer pricing guidelines. These agreements must provide economic support of arm’s length terms, as well as complete and accurate descriptions of the transactions. The CRA however, has not adjusted their requirements to include OECD transfer pricing guidance to include the treatment of “cash boxes” affecting outbound financing of foreign subsidiaries of Canadian multinationals and BEPS’ proposed simplified approach to low value-adding services.

OECD Action 13 has been implemented and requires corporate groups with annual consolidated revenues exceeding €750 million to maintain:

  • Country by Country Reporting: Key information on all group members of the multinational
  • Master File: Key information about the Multinationals Group’s Global Operations
  • Local File: Information and support on the local countries intercompany transactions

US reporting requirements are set forth in the Treasury Regulations and are also similar to the OECD transfer pricing guidelines.

Need Help? 

UHY Victor has expertise dealing with Canada/U.S. transfer pricing issues. 

Contact us for a free consultation regarding your transfer pricing situation:

UHY Victor LLP Canada U.S. Tax Team
(514) 282-0067


Click here to obtain a complimentary copy of our 2015 UHY Global Transfer Pricing



UHY Victor Response to the Spread of COVID-19

UHY Victor is taking action to maintain the health and welfare of our team, our clients and support communal efforts to respond to the coronavirus pandemic.

UHY Victor will remain open during this difficult period and client services will continue. We have implemented contingency plans which allow us to continue to operate as we all deal with the spreading pandemic.

In light of the present situation we have introduced the following measures:

  • Our staff and procedures have been structured so that our team can work remotely.
  • Our IT infrastructure and data are protected by cutting edge security systems.
  • To the extent possible, client meetings will be held through web meetings and other remote solutions.
  • Employees who experience the primary symptoms such as fever, cough and respiratory difficulties will work remotely until cleared.
  • Internally, we emphasize the importance of “social distancing”, and have enhanced our internal cleaning and disinfecting protocols.

UHY Victor will continue to monitor the changing situation and, will respond proactively as this major health challenge evolves.

We encourage all to stay informed and to visit the Public Health Agency of Canada COVID-19 site, and follow the guidelines set out by the government of Canada:

  • Now and always during cold and flu season, stay home if you are sick. Encourage those you know are sick to stay home until they no longer have symptoms.
  • Since respiratory viruses, such as the one that causes COVID-19, are spread through contact, change how you greet one another. Instead of a handshake, a kiss or a hug, a friendly wave or elbow bump is less likely to expose you to respiratory viruses.
  • Practice frequent hand hygiene and coughing and sneezing etiquette. Clean and disinfect frequently touched objects and surfaces, such as toys and door handles.

For more information on the guidelines of the Government of Canada on how to be prepared for COVID-19: Click here.

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