Transfer pricing sounds like a “big company” problem until the day your group company invoices you for management fees, shared services, royalties, or intercompany loans, and suddenly you are expected to prove it is fair. In the UAE, transfer pricing is not about fear. It is about being ready. If your pricing between related entities is not well-supported, your tax position can become harder to defend than it needs to be. That is why many businesses speak to a corporate tax consultant in Dubai early, before their first review, audit, or filing pressure starts.
What transfer pricing means
Transfer pricing refers to the method you apply to determine the prices of transactions between related parties. The term “related” usually means companies under common ownership or control, or where one party can influence the other’s decisions. Common examples include:
- Management or shared service fees
- IT support, HR support, and back-office charges
- Intercompany sales of goods
- Royalties for using a brand, software, or IP
- Intercompany loans and interest
The simple expectation is this: your intercompany pricing should look like what independent businesses would agree to in a normal market.
Why transfer pricing matters in the UAE right now
As the UAE Corporate Tax environment reaches maturity, authorities expect businesses to hold clear records in support of their tax positions. Transfer pricing commonly becomes a focal point, due to its effect on profitability, taxable income, and how value is aligned across entities. If your documentation is weak, even “normal” charges can raise questions.
This is where a Tax Consultant in Dubai can help you understand which transactions need attention first and how to reduce risk without slowing down operations.
Tax Consultant in Dubai: the “fundamentals” you should get right first
Before you chase complex models, focus on the basics that create clarity:
1) Identify your related-party transactions
Make a list of transactions with sister companies, parent companies, owners, or related entities. If it impacts revenue, costs, or financing, include it.
2) Define what the service or value actually is
A vague line like “management fee” is not enough. Be specific. What was done? Who did it? What outcome did it create?
3) Make sure the pricing method makes sense
You do not need to overcomplicate it, but you do need logic. For example, cost-plus for services can be reasonable when supported with clear cost breakdowns and a consistent markup approach.
4) Keep clean supporting documents
Contracts, invoices, work logs, emails, proof of delivery, and internal approvals all reduce future friction.
Tax agents in UAE: Quick wins you can implement this week
Here are practical “quick wins” tax agents in UAE often recommend making transfer pricing easier to defend:
- Create a related-party register: one sheet listing parties, transaction type, frequency, and value
- Standardize intercompany agreements: update templates so every recurring charge has a contract behind it
- Add short service descriptions on invoices: one or two clear lines explaining what was delivered
- Track costs properly: keep a simple cost file for shared services (salaries, tools, overhead basis)
- Document the business reason: why this charge exists and why it helps the UAE entity operate
These steps sound basic, but they prevent the biggest headaches later: unclear purpose, missing evidence, and inconsistent pricing.
Business Advisory Services: making transfer pricing operational, not theoretical
Transfer pricing fails in real businesses when it lives only in spreadsheets and reports. You need a process that your finance team can repeat every month. That is where Business Advisory Services help, because the goal is not a perfect academic file. The goal is a clean, consistent trail that matches how your business actually runs.
Business advisory support can help you:
- Build a simple monthly workflow for intercompany charges
- Align finance, operations, and management approvals
- Reduce “end of year scrambling” with ongoing documentation
- Keep your structure scalable as the group grows
When to involve a corporate tax consultant in Dubai
You should consider speaking with a corporate tax consultant in Dubai if:
- You have multiple entities under the same ownership
- You pay or receive management fees, royalties, or shared service charges
- You have intercompany loans or significant related-party sales
- Your business is growing fast, and you want the structure to scale cleanly
Final takeaway
Transfer pricing in the UAE is not just a compliance concept. It is a business clarity tool when done properly. Start with the fundamentals, apply quick wins that strengthen your documentation, and keep your approach consistent. If you want, we can turn your related-party transactions into a simple checklist and documentation pack your team can use every month, based on your structure and activity.
