Understanding Transfer Pricing Adjustments

Category: Business

Your company just received a tax notice. The authorities say you underpaid taxes by crores. Why? Because of transfer pricing adjustments. You thought your inter-company pricing was fair. But the tax department disagrees. Now you’re facing massive tax demands, penalties up to 200%, and months of stressful negotiations. Transfer pricing adjustments happen when tax authorities determine that prices charged between related companies don’t match fair market rates.