Practice showed us that the rate applicable for the preparation of a transfer pricing documentation file may vary between several thousand EUR (in the case of a company with simple business that does not interact significantly with its related parties) and several tens of thousands EUR (for a very large company involved in highly complex and diverse business activities with its related parties).

There are multiple factors that directly affect the workload required to prepare a transfer pricing documentation file or result in additional overheads (e.g. for the databases used to prepare the comparability / benchmarking studies), which consequently generate an increase in the applicable rate.The most important of such factors include:

  • complexity of the business of the group and the local company for which the transfer pricing documentation file is prepared;
  • availability of group-wide documentation to be used as basis for the preparation of the local documentation;
  • number of the company’s transactions with related entities to be documented;
  • transfer pricing methodology used for each category of the company’s transactions with related entities;
  • number of comparability / benchmarking studies to be prepared (such studies involve overheads incurred for the use of specialized databases such as Amadeus, RoyaltyStat, LoanConnector or Bloomberg).

Companies with transfer pricing documentation that update it annually will have the advantage of:

  • better management of cost operating for their TP file;
  • early identification of tax risks as well as taking the necessary precautions in order to minimize them.