- 8 Marks
ATAX – Nov 2018 – L3 – Q4c – Transfer Pricing
Advisory on maintaining the arm's length principle in inter-company transactions for Abbey Limited.
Question
(c) You are the tax controller of Abbey Limited, the holding company of a group of companies involved in various businesses including: trading, manufacturing, distribution, and packaging. The companies from time to time supply goods and services to each other at pre-determined prices.
You are required to:
Advise the board of Abbey Limited on the factors to be considered when the entities transact business amongst themselves to ensure that the arm’s length principle is upheld.
(8 Marks)
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