What Companies Need To Understand About Transfer Pricing

What is Transfer Pricing?

Transfer pricing refers to the price of transfers and transactions entered into between related parties or subsidiaries. Transfer pricing generally refers to intercompany pricing arrangements for the transfer of goods, services and intangibles between associated persons. The transfer price should ideally match the prevailing market price, as it would in a transaction involving independent persons.

Malaysian Transfer Pricing Guidelines

The Malaysian Transfer Pricing Guidelines (hereinafter referred to as ("the Guidelines"), provides detailed guidelines and standards on how companies should manage transfer pricing in compliance with Section 140A of the Income Tax Act 1967 ("the Act") and the Income Tax (Transfer Pricing) Rules 2023 ("TP Rules 2023").