TPguidelines

Another situation which it may be necessary to consider arises_ when a benefit provided to one enterprise within a group is balanced to some degree by different benefits provided by that enterprise in return, with the consequence that the enterprises claim that the benefit received should be set off against the benefits provided as full or part payment for those benefits so that only the net gain or loss (if any) on the transaction needs to be taken into account in assessing the tax liabilities of the enterprises. An enterprise may, for example, license another enterprise to use a patent in return for the provision of know how in another connection and claim that the transaction results in no profit, no loss. This kind of Arrangement is encountered sometimes between unrelated parties and it could not be argued therefore in principle that it is unacceptable between associated enterprises.