TP documentation

TP (Transfer Pricing) documentation refers to detailed records and reports that companies create to demonstrate how they price transactions between their related entities, such as subsidiaries or branches across different countries. This documentation ensures that these internal prices are fair and comply with tax laws, preventing profit shifting and tax evasion. It typically includes explanations of the company's transfer pricing strategy, financial data, and comparisons with market prices. Proper TP documentation helps tax authorities verify that the company's cross-border transactions are conducted at arm's length, ensuring fair tax contributions in each jurisdiction.