PTP's Tax Tip No.4 ' Are there transfer pricing issues?

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Q: My company, in which I'm the sole shareholder, has a turnover of 40m and I employ 270 people. My wife's company, in which my wife and I own 50% of the shares each uses a spare office in my head office. Her phone calls are put through by our receptionist and, other than a couple of sheets of headed paper, that's all she takes. I've never charged her for anything. Do I have transfer pricing issues?

A: Yes. Five of them! The office rent, phone charges, use of reception staff, use of stationery and use of your company's branding via the headed paper. Because of your control of both companies and the fact that you are a large company in the eyes of the EU, you must consider, and retain documentation of your thoughts as to transfer pricing in your 'group'. A small recharge will probably be nec...

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