Benchmarking is a key element of transfer pricing. Benchmarks support the arm’s length nature of intercompany transactions. Benchmarks can either be used to determine a price upfront or to support an existing transaction. Benchmarks prepared upfront allow clients to select an arm’s length price that minimises transfer pricing risk while taking into account potential tax efficiencies. When benchmarks are prepared retrospectively, the primary goal is to support the arm’s length nature of the existing transaction. As the price can no longer be amended, these benchmarks may be complex if prices deviate from the arm’s length principle.
Embridge has access to a wide range of databases that can be used for benchmarking purposes. Besides subscription based databases, we also use publically available sources where needed. Through our experience, data availability and creative mind-set, we are able to offer a wide range of standard and non-standard benchmarking solutions.