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Transfer pricing |
See Also
Adjustment of profit | Intangible Fixed Assets | Loan relationships | Miscellaneous income and gains | REIT property business analysis | UK property business analysis
Select from the following headings:
Background | Developing the schedule | Completing the Schedule | Standard Sub-Schedules | Carry Forward | Related Errors
This schedule is used to analyse both UK-UK and UK-Non UK transfer pricing adjustments. Amounts are posted to the schedule for the relevant tax category to ensure that adjustments are taxed or relieved correctly.
The schedule is developed from the Adjustment of profit using the Tax sub-menu.
In all cases, the schedule will display sections for adjustments in respect of trading and non loan relationship items.
Adjustments in respect of other items will only be shown if the applicable corresponding
schedule is developed. The software supports adjustments in the following categories:
UK Property business analysis
Miscellaneous income and gains
Intangible fixed assets - trading and non-trading intangibles
Loan relationships - trading and non-trading loan relationships
REIT property business analysis
Jurisdiction
Using the dropdown menu, the user should specify whether the adjustment relates
to a transaction with a UK or Non UK entity (UK-UK or UK-Non UK).
An adjustment to increase in taxable profits should be entered as a positive
amount. The schedule will only allow a negative adjustment (a compensating adjustment)
in respect of UK-UK transactions.
The user has the option of entering details of the adjustment in two ways, depending
on the nature of the adjustment:
Adjusted price/value and Adjusted units/% (columns C & D) - These
columns allow a user to input details of an adjustment which relate to a number
of items or units. For example, for an adjustment of £10 per unit applying
to 1000 units of stock, enter £10 in column C and 1000 in column D.
Note: If a percentage adjustment is required, the formatting of the
relevant cell in column D may need amending so the software can recognise it
as a %, rather than a number of units. This is done by selecting the appropriate
cell, and in the Format cells menu, selecting the 2 decimal places option. Then
for example, entering 0.03 would apply a 3% adjustment to the amount in column
C.
Adjusted fixed value (column E) - this column allows a total adjustment
amount to be entered.
Total adjustments for each category are posted the relevant schedule to be taxed
/ relieved under the appropriate rules. For example a non-trading loan relationship
adjustment is posted to the Loan relationships schedule. The schedule also calculates
the total amount of UK-UK and UK-Non UK adjustments.
There are no standard sub schedules.
This schedule does not carry forward.
| Error | How to solve it |
| Negative non UK item | Compensating adjustments cannot be claimed on UK-Non UK items. Either change the jurisdiction to UK-UK if appropriate, or delete the entry. |
| Develop loan relationship schedule | Develop the schedule so that transfer pricing adjustments will be posted to that schedule and taxed / relieved appropriately. |
| Develop intangibles schedule | Develop the schedule so that transfer pricing adjustments will be posted to that schedule and taxed / relieved appropriately. |
| Develop property business schedule | Develop the schedule so that transfer pricing adjustments will be posted to that schedule and taxed / relieved appropriately. |
© 2009 Thomson Reuters.