Protect Your Group From Hong Kong Transfer Pricing Audits
IRD has increased transfer pricing audits by 340% since 2021. Without contemporaneous documentation under IRO Part 8A, your group faces automatic penalties — even if your intercompany pricing is correct.
Transfer Pricing & IRO Part 8A
IRD has increased transfer pricing audits by 340% since 2021. Without contemporaneous documentation under IRO Part 8A, your group faces automatic penalties — even if your intercompany pricing is correct.
⚠ IRD Is Actively Targeting Transfer Pricing — Documentation Gaps Are Automatic Violations
Under IRO s.50AAF, a company that fails to prepare and maintain required transfer pricing documentation — master file, local file and/or CbCR — is subject to penalty even if its intercompany pricing satisfies the arm's length standard. IRD does not need to prove your pricing is wrong; the absence of contemporaneous documentation is itself a breach. Penalty: up to HK0,000 per year of assessment.
您是否正面對以下稅務問題？
No Contemporaneous Documentation
Many Hong Kong companies with related-party transactions have never prepared a formal transfer pricing policy or benchmarking study. Under IRO Part 8A, this is a penalty risk regardless of whether pricing is arm's length.
Royalty Payments to Offshore IP Holding Companies
BEPS has made royalty arrangements to BVI, Cayman or other low-tax IP holders a primary IRD audit target. Without nexus-based documentation, royalty deductions are vulnerable to challenge.
Management Fee & Services Charges
Intercompany service charges and management fees face heightened scrutiny. IRD expects cost-plus benchmarking aligned with OECD guidance, not arbitrary percentages or historical arrangements.
Supply Chain Restructuring Without TP Analysis
Moving functions, risks or assets between group entities triggers transfer pricing on the restructuring itself, not just the ongoing transactions. Creating a HK procurement hub without TP analysis is increasingly challenged.
適合對象
MNCs using Hong Kong as a regional hub with significant intercompany service charges, management fees, or cost-sharing arrangements.
Groups with HK acting as principal buyer from Asian contract manufacturers, reselling to group distributors globally.
Tech groups with IP royalty flows through Hong Kong requiring nexus-based documentation under FSIE and TP rules.
Entities that have received a formal IRD transfer pricing enquiry or information request and need expert audit defence.
服務範疇
Local File Preparation
Transaction-level documentation: functional analysis, method selection, benchmarking study using Orbis/TP Catalyst databases, and arm's length range determination.
Master File & CbCR
Group-level master file describing organisational structure, global value chain, intangibles and group TP policy. CbCR preparation and filing for groups above HK.8B.
Advance Pricing Arrangement (APA)
Application and negotiation of unilateral APAs with IRD to fix pricing methodology for 3–5 years. Bilateral APAs available under MAP provisions of applicable CDTAs.
IRD Audit Defence
Expert representation during IRD transfer pricing audits. We review proposed adjustments, identify technical grounds for challenge, and negotiate settlements.
TP Policy Design & Planning
Group-wide transfer pricing policies that are commercially defensible, BEPS-compliant and aligned with actual value creation. Includes FAR workshops and ICA drafting.
簡單、高效、專業
Transaction Scoping & Threshold Analysis
Review group structure and related-party transactions to determine which tiers of documentation are required (local file, master file, CbCR) and identify highest-risk transactions.
5–10 business daysFunctional Analysis (FAR)
Structured interviews with operations, finance and legal teams to map functions performed, assets used and risks assumed by each party to each covered transaction.
1–2 weeksMethod Selection & Benchmarking
Select the most appropriate OECD method, define the tested party, and run comparable company searches. Statistical interquartile range establishes the arm's length range.
2–3 weeksDocumentation Package & Annual Maintenance
Full draft of local file, master file, CbCR in IRD-compliant format. Annual refreshing service to update financial data and re-run benchmarking searches.
2–4 weeks + annual為真實客戶帶來真實成果
HK Trading Company — BVI Royalty Challenge, HKM adjustment at stake
- 8% royalty on turnover paid to BVI parent — no TP documentation
- IRD proposed full disallowance: HKM adjustment, ~HKM tax
- CUP benchmarking study with 23 comparable royalty agreements prepared
European Manufacturing Group — APA securing HKM/year certainty
- HK procurement hub with 6 Asian contract manufacturers
- TNMM mark-up of 3.2%–6.8% agreed with IRD Large Business Unit
- Unilateral APA with 2-year rollback executed in 14 months
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