Transfer pricing implications of intercompany services

Intragroup services such as management, IT, or legal support are often subject to scrutiny during tax audits. In this training course, you will learn how to correctly substantiate, recharge, and document such services in accordance with OECD guidelines and Belgian transfer pricing practice.

Content

This session provides practical insights into how to manage intragroup services correctly for tax purposes. We cover topics such as the benefit test, the composition of the cost base (including direct vs. indirect costs and shareholder costs), and the correct application of mark-ups, with a particular focus on strategic vs. routine services. We will also discuss the requirements for documentation and service agreements, the application of the OECD regime for low value-added services, and how to arm yourself against discussions with tax authorities.

Target group

This training course is intended for transfer pricing specialists, financial and legal professionals involved in the pricing, invoicing, and documentation of intra-group services within multinational companies.

Duration

A physical session typically lasts 1.5 to 2 hours and is organized at the client’s premises. An online session lasts 1.5 hours.

Timing

We offer our training courses online or as customized in-company training courses tailored to the specific needs of companies. If you are interested, please contact us via the “REQUEST INFORMATION” button above. We will be happy to consult with you to schedule a session that fully meets your needs.

Programme

  • Overview of intra-group services: What are intra-group services and why are they often subject to scrutiny by tax authorities? Examples include management, IT, legal, and HR services.

  • The benefit test: proof of economic added value. How do you demonstrate that a service delivers value to the recipient? With a focus on avoiding double charging (no mark-up on mark-up).

  • Cost allocation and attribution: Discussion of cost allocation methods and the correct composition of the cost base, including the distinction between direct and indirect costs and the treatment of shareholder costs that may not be passed on. The strategic importance of a service also plays a role — for example, the difference between routine procurement (mark-up on OPEX) and strategic procurement (possible mark-up on COGS + OPEX).

  • Substantiation of intra-group services: How do you perform an economic analysis? When and how do you apply the OECD rules for low value-added services (with a simplified 5% mark-up)?

  • Documentation requirements: What elements do you need to document in order to correctly substantiate the fees for intra-group services?

  • Challenges during tax audits: Common discussions with tax administrations and how to prepare for them.

  • Best practices for service agreements: Recommendations for clear, well-substantiated, and legally sound intercompany service agreements.

  • Summary and Q&A: Key insights at a glance, with room for questions.