Financial Services Transfer Pricing

Managing Transfer Pricing

The challenges you face

There is no doubt that the challenge posed by the downturn to transfer pricing practice for Swiss based financial institutions is immense. The effects of the crisis on every dimension for the global financial services industry are already profound.

Relevant recent developments affecting most if not all multinational financial institutions include:

• The subject of losses and their impact from a tax and transfer pricing perspective.
• The impact of the downturn on the tax risks from intra-group financial transactions, including interest applied on debt, thin capitalisation and guarantee fees.
• OECD Discussion Draft regarding Transfer Pricing Aspects of Business Restructurings.
• Discussion draft on a new Article 7 (Business Profits) of the OECD Model Tax Convention.
• OECD project on the application of transactional profit methods.
• Impact of OECD papers I to IV on attribution of profits to PEs and incorporation into local country guidance and legislation.

How PwC can support you

Our experience

Our team's experience spans planning, documentation and defence for Swiss and globally based financial institutions across all financial services sectors. The illustration below includes most of the sub-sectoral issues we have advised on.

Delivering value to our clients

PwC's Swiss Financial Services Tax and Transfer Pricing group has over 10 dedicated professionals specialising in helping Swiss based financial institutions optimise their group tax position through transfer pricing, whilst minimising their tax risk. This includes providing our Swiss based financial services clients with:

• Coordinated transfer pricing planning advice to optimise tax opportunities;
• Guidance on documentation to ensure compliance in countries with rigorous transfer pricing rules;
• Support in respect of enquiries from the Swiss Federal Tax Administration and/or Cantonal Tax Authorities;
• Co-ordination assistance given existing transfer pricing policies to ensure global consistency in achieving the above objectives.

Our approach

In delivering the above benefits to our financial services clients, our approach focuses upon: 

• Defining with our clients their commercial requirements and developing appropriate tax strategies that are consistent with these requirements.
• Utilising our highly efficient process for documenting and justifying transfer pricing policies.
• Using our vast international resources for more easily obtaining comparable third party data to support transfer prices in a variety of financial services related contexts. 
• Where appropriate, using health checks to identify and analyse planning opportunities, exposures and priorities.