TPguidelines

It is clearly easier for tax authorities and MNEs to agree tax liabilities if charges for goods, services, etc., are made direct to the appropriate customer. MNEs may, however, arrange some transactions in a less direct manner (particularly intra-group services and transfers of technology, through interposed affiliates). This may be done for purely business reasons, but such a strategy could also be part of a tax avoidance scheme. Such practices may raise the question how far a real benefit has in fact been conferred on the related party which is ostensibly paying for it and how far such a transaction affects other entities. Problems of this kind are likely to arise where a variety of alleged benefits are charged for in one package deal.