In today’s globalised business environment, transactions between related parties across borders have become common. While such transactions are commercially necessary, they also attract scrutiny from tax authorities. In India, Transfer Pricing (TP) regulations are strictly enforced to ensure that transactions between associated enterprises are conducted at an arm’s length price.
At Legal N Tax, we offer comprehensive TP Audit & Compliance services, helping businesses manage transfer pricing obligations with accuracy, transparency, and confidence. Our Consultant for Transfer Pricing Audit in India ensures that your inter-company transactions comply with Indian tax laws while minimising litigation and adjustment risks.
What is Transfer Pricing and TP Audit?
Transfer Pricing refers to the pricing of goods, services, intangibles, or financial transactions between associated enterprises (AEs), mainly when one or more of them are located outside India.
A Transfer Pricing Audit in India is an examination conducted by the Income Tax Department to verify whether such transactions comply with the arm’s length principle as prescribed under the Income Tax Act, 1961 and relevant rules.
Non-compliance can lead to:
- Transfer pricing adjustments
- Additional tax demands
- Interest and penalties
- Prolonged litigation
This makes robust TP compliance and documentation essential
Applicability of Transfer Pricing Regulations in India
Transfer pricing provisions apply when:
- Transactions occur between associated enterprises
- One or both entities are non-residents, or
- Specified domestic transactions exceed prescribed thresholds
Everyday transactions covered include:
- Purchase or sale of goods
- Provision of services
- Payment of royalties or fees
- Inter-company loans and guarantees
- Cost-sharing arrangements
Our Consultant for Transfer Pricing Compliance in India helps assess applicability and ensures complete compliance.
Importance of TP Audit & Compliance
Effective Transfer Pricing compliance in India offers several benefits:
- Reduces risk of tax adjustments
- Enhances transparency with tax authorities
- Ensures consistency in pricing policies
- Supports global tax governance
- Builds confidence among stakeholders and investors
Proper documentation and timely reporting act as a strong defence during TP audits.
Key TP Compliance Requirements in India
Businesses subject to TP regulations must comply with:
1. Maintenance of TP Documentation
Comprehensive documentation justifying arm’s length pricing of transactions.
2. Filing of Form 3CEB
A mandatory audit report certified by a Chartered Accountant, filed annually.
3. Disclosure in Income Tax Return
Correct reporting of international and specified domestic transactions.
4. Adherence to Arm’s Length Methods
Selection and application of appropriate pricing methods.
Legal N Tax ensures that all these requirements are met accurately and on time.
TP Audit Process – What to Expect
During a TP audit, tax authorities may:
- Issue notices seeking information
- Examine TP documentation
- Question benchmarking analysis
- Propose pricing adjustments
Our team supports you at every stage, from notice response to final resolution.
TP Audit & Compliance Services Offered by Legal N Tax
At Legal N Tax, we provide end-to-end TP solutions tailored to your business structure and industry.
1. Transfer Pricing Applicability Assessment
We identify whether your transactions fall under TP regulations and evaluate risk exposure.
2. TP Documentation & Study Report
Preparation of detailed TP study reports, including:
- Functional, asset, and risk (FAR) analysis
- Selection of the most appropriate method
- Comparable search and benchmarking
- Economic analysis and justification
3. Form 3CEB Certification Support
Coordination with auditors to ensure accurate reporting and timely filing.
4. TP Audit Support & Representation
Handling notices, preparing responses, and representing clients during TP assessments.
5. Advisory on TP Policies
Development of robust TP policies aligned with global best practices and Indian regulations.
6. Litigation & Dispute Resolution Support
Assistance in objections, appeals, and dispute resolution mechanisms.
Why Choose Legal N Tax for TP Audit & Compliance?
1. Specialised Transfer Pricing Expertise
Our professionals possess strong technical knowledge and hands-on experience in TP matters.
2. Industry-Specific Approach
We tailor benchmarking and pricing strategies based on your industry and transaction nature.
3. Proactive Risk Management
We identify potential issues early and address them before they escalate into disputes.
4. Seamless Coordination
We work closely with your finance and legal teams to ensure smooth compliance.
Who Needs TP Audit & Compliance Services?
Our TP services are ideal for:
- Multinational companies
- Indian subsidiaries of foreign entities
- Startups with overseas investors
- Companies engaged in cross-border services
- Businesses with inter-company financing arrangements
Whether you are a growing startup or an established multinational, Legal N Tax offers scalable TP solutions.
Common Challenges in Transfer Pricing Compliance
Businesses often struggle with:
- Identifying appropriate comparables
- Frequent regulatory changes
- Documentation gaps
- Time-consuming audits
- High litigation exposure
Our structured and compliant approach helps overcome these challenges effectively.
Our Commitment to Compliance and Business Continuity
At Legal N Tax, our experts for Transfer Pricing Compliance in India believe transfer pricing compliance should support—not disrupt—business operations. Our focus is on accuracy, defensibility, and practicality, ensuring that your pricing policies withstand regulatory scrutiny while aligning with business objectives.
We don’t just prepare reports—we help build sustainable and compliant transfer pricing frameworks.
Stay TP Compliant with Confidence
Transfer pricing audits can be complex, but with the proper support, they become manageable. Let Legal N Tax handle your TP Audit & Compliance requirements with professionalism and precision.
Email: mail@legalntaxindia.com
