When companies performs adjustments to the pricing of intercompany transactions in order to secure an arm's length remuneration, the adjustment is performed on the earnings of the year under audit. The adjustment is generally performed in order to adjust the impact of the transactions based on an overall assessment such as EBIT margin. From a VAT perspective, the practice is applicable as an adjustment is based on an overall assessment will lose the direct link between the transaction and the adjustment, which is required to let the corrected transfer price follow in tandem with the adjusted VAT base. A transfer pricing adjustment is performed to ensure correct profits are taxed according to the value creation between the different countries involved. The adjustment is, however done in a way that prevent correct VAT adjustment to be made subsequently. This thesis discuss the issues that arise from a transfer pricing perspective to an adjustment that impact the VAT and how it should move in tandem, however is often overlooked in practice. In Denmark, VAT law has lex superior status compared to transfer pricing regulations and requirements, consequently adjustments that needs to be made for prior transactions must be performed from a VAT base and have the transfer pricing and taxation as a derived effect, and not to other way around as it is the case in contemporary Denmark.
|Uddannelser||Cand.merc.aud Regnskab og Revision, (Kandidatuddannelse) Afsluttende afhandling|