Transfer Pricing Documentation in a Post BEPS World - KPMG Global
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Asset Management: Practicalities of Transfer Pricing Documentation in a Post BEPS World

Transfer Pricing Documentation in a Post BEPS World

Here are some practical considerations and implications that arise for Investment Managers when preparing transfer pricing documentation post BEPS.


Partner, Global Transfer Pricing Services

KPMG Limited (GI)


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The introduction of Country-by-Country (“CbyC”) reporting, Master File, and Local File transfer pricing documentation requirements through Action 13 of the OECD’s1 Base Erosion & Profit Shifting (“BEPS”) Project, as well as other transfer pricing related BEPS Actions (for example, Actions 8-10), raise a number of practical considerations for a multinational Investment Manager (“IMgr”).

Many jurisdictions have introduced legislation requiring all or some of the BEPS 13 documentation elements, whilst many of the principles in Actions 8-10, which focus on the impact of value creation on transfer pricing policies, are reflected in the recently released 2017 edition of the OECD transfer pricing Guidelines2.

This section explores some of the practical considerations and implications that arise for IMgrs when preparing transfer pricing documentation post BEPS. 

Planning for Post BEPS Transfer Pricing Documentation

Careful planning for transfer pricing documentation is advisable given country differences in implementation of the Action 13 requirements for CbyC report, Master File and Local File transfer pricing documentation. Thus, some key questions that multinational IMgrs should explore:

  • What are the CbyC, Master File, and Local File requirements across the jurisdictions in which the IMgr operates?
  • Do local country requirements deviate from BEPS 13 (e.g. additional Master File functional analysis requirements in India)?
  • What are the deadlines that need to be met?
  • For the CbyC report, which entities are includable? And in which jurisdiction should it be filed?
  • Where there is a CbyC reporting requirement but no Master File requirement (e.g. Canada), should a Master File be prepared anyway to position the CbyC reporting outcomes?
  • Where there is no Local File requirement, is there another documentation obligation?
  • Are there any conflicts between the Master File deadline and deadlines for transfer pricing documentation in other jurisdictions?
  • Does the Master File need to be physically filed or just completed by a certain date?

IMgrs may wish to map out the countries in which they operate and the corresponding requirements. Based on this assessment, it is prudent to then identify responsibilities for the preparation of the CbyC reports, Master File, Local Files, or other transfer pricing documentation. These responsibilities could be centralized, performed locally, or a hybrid of both.

Structuring of transfer pricing documentation

Today’s multinational IMgr organizations are increasingly complex and varied, which raises questions on how to approach the structuring and content of transfer pricing documentation. For example, a multinational IMgr may provide asset management services to a Fund and be distinct from the underlying investments, or it may also invest on its own behalf (e.g., alternative IMgrs). Further, it may have a number of different asset classes / business segments. These, amongst other factors, can influence the overall approach to transfer pricing documentation post BEPS; there is no “one-size-fits-all” approach.

Key considerations include: 

  1. How does the IMgr consolidate for financial statement purposes? Does this include investments (i.e., portfolio companies) and fund entities, or are these excluded? The answer to this question can impact decisions on the level of detail to include in the CbyC report3 and Master File.
  2. Does the IMgr have diverse operations with a number of asset classes and dedicated teams? If so, consideration can be given to dealing with each of these in separate chapters within the Master File, or within separate Master Files where appropriate.
  3. For the Local Files, the analyses of certain transactions that are already addressed in centrally prepared transfer pricing documentation may not need to be fully repeated in country-specific reports.
  4. Given the greater focus on value chains in Actions 8-10 and 13 of BEPS, it may be wise to consider whether the activities performed are similar across asset classes and investment teams. Decisions will be required on how to present those activities in the Master File and on how the economic analysis may need to differ in the Local Files depending on which business segments are relevant in each jurisdiction.
  5. Central versus local preparation: Multinational companies face decisions on who will be responsible for preparing Master File and Local File transfer pricing documentation within the organization. Centralized preparation of transfer pricing documentation helps to promote consistency, the importance of which is discussed below, but may lead to an inadequate focus on local requirements and practices. Conversely, whilst decentralized preparation may better focus on local requirements, it can lead to inconsistencies among the various documents and higher total costs. Often, it comes down to centralization of certain tasks, such as drafting the Master File, with local involvement and review where appropriate. For Local Files there is likely to be a higher degree of involvement and completion locally (perhaps leveraging a common template), with some measure of central review.

The structure and operations of an IMgr, along with availability and allocation of its resources, will help determine the optimal strategy for preparation of BEPS 13 documentation.

Goal: A consistent story

Automatic information exchange between tax authorities (a work in progress under BEPS), increased public and media scrutiny, and the proliferation of information on the internet has led to an ever increasing need to ensure consistency in how today’s multinationals communicate their activities and policies.

Areas IMgrs may wish to evaluate include the following:

  • Is the messaging of the Master File, Local Files, and other transfer pricing documentation consistent with the CbyC data? Where not, can this be reasonably explained? 
  • To what extent are the Master File and Local Files consistent with Regulatory Filings? 
  • Are transfer pricing policies and their documentation (in all forms) consistent with public information (e.g. company website, LinkedIn, etc.)?

It is important to ensure that all transfer pricing documentation is aligned, as well as consistent with other information available, and that the resulting transfer pricing policies are defensible. 


The preparation of transfer pricing documentation under BEPS requires an analysis of requirements across jurisdictions and consideration of efficient approaches to meeting those requirements, based on the structure and business activities of the IMgr as well as available resources. The overriding goal is completeness of transfer pricing documentation, and consistency among the various components as well as with regulatory filings and public information. 

1 OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations

2 Further information on Action 13 of the OECD’s BEPS Project is contained at the following link:

3 Or help determine whether a CbyC report is even needed, given the revenue thresholds under BEPS Action 13.

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