Analysis and evaluation of intercompany transactions carried out by the company (taxpayer) during the fiscal year, with the aim of determining whether they comply with the arm’s length principle (market values).
Why is it necessary?
It is an annual tax obligation established in Article 76, sections IX, XII, and XIII of the Income Tax Law.
Scope
Functional Analysis and Information Gathering
Transfer Pricing Analysis
Comprehensive LISR compliance study with preventive analysis, digital files for Annex 9, and local and international informative returns.
Is conducting a Transfer Pricing Study an annual obligation?
Yes, it must be carried out annually, and all transactions performed are evaluated, regardless of their amount.
Am I obligated to conduct a Transfer Pricing Study if I am a business group that only operates in Mexico?
Yes, the obligation to conduct intercompany transactions at market values and to have an analysis considering the methodology described in the Law applies to any intercompany transaction (between domestic entities and/or with foreign residents).
If there is no consideration (charge/payment) in an intercompany transaction, does it need to be evaluated and documented?
Yes, the absence of a charge or payment in an intercompany transaction means that the consideration is zero, and it is necessary to determine if zero would be a market price.
What are the consequences if I choose not to conduct the transfer pricing study?
It mitigates risks of fines, tax adjustments, non-deductibility, and double taxation during authority reviews.
