What is included in the fee for master file & CbCR?
The group-level documentation and the country-by-country report, prepared so they agree with each other and with every local file in the footprint.
What would make master file & CbCR cost more than the standard tier?
The number of jurisdictions. Each one reads the same master file, so an inconsistency anywhere is visible everywhere through information exchange.
Is the fee really fixed?
Yes, for the scope quoted. If the scope changes — another year appears, an entity turns up, a certificate becomes necessary — we re-quote before doing the work, so there is never an invoice you have not already agreed to.
How much does a master file and country-by-country report cost?
The fee is agreed in writing before the work begins and reflects the footprint rather than the page count: the number of jurisdictions carrying a filing or notification obligation, the number of entities whose figures have to reconcile, and whether the group's local files already exist. A first-year engagement where the documentation is built from nothing is a different piece of work from a refresh where last year's file stands and only the changes need working through. We look at the group structure and the consolidated figures before quoting, and if the footprint changes mid-engagement we re-quote rather than adjust the invoice at the end.
What is the difference between a master file and a local file?
The master file describes the group: how it is organised, where value is created, what intangibles it owns, how it is financed, and what its overall transfer pricing policy is. A local file describes one entity's actual controlled transactions, with the comparables and the arm's length analysis supporting them. Tax authorities read the two together, and the point of failure is usually the join. A local file characterising an entity as a limited-risk distributor, while the master file describes it as owning market intangibles, hands the examiner the argument. Preparing them as one exercise is what stops that happening.
Does our group actually have to file a country-by-country report?
It depends on the group's consolidated revenue for the preceding year measured against the threshold each relevant jurisdiction has adopted, and on where the ultimate parent sits. Two things catch groups out. The thresholds are expressed in different currencies, so a group can sit inside one jurisdiction's test and outside another's. And the notification obligation is separate from the filing obligation, so a subsidiary often has to tell its own authority who is filing and where, by a deadline of its own, even in a year when it files nothing locally.
Who in the group files the country-by-country report?
Ordinarily the ultimate parent entity files in its own jurisdiction, and the report is then exchanged with the others under the relevant agreements. Where the parent sits in a jurisdiction that does not require the report, or does not exchange it with a market the group operates in, a surrogate parent can be designated to file on the group's behalf, and in some cases a local filing obligation falls on the subsidiary directly. Which of those applies is a structural question about the group, and it should be settled early, because each subsidiary's notification has to name the filing entity correctly.
Our master file was prepared overseas, can we use it in Canada?
Often yes, and that is usually the sensible starting point rather than writing a second one. What it needs is review against what the Canadian entity's own documentation says and against what the local authority expects to see, including the language it is provided in. The common gaps are a description of the Canadian entity's functions that does not match its local file, an intangibles section that predates a restructuring, and financial data that cannot be tied back to the group accounts. We work from the existing file, mark what has to change and why, and keep one version of the group's story.
What happens if our local file contradicts the master file?
It becomes the first thing an examiner reads. An inconsistency between the two is less a technical breach than an invitation, because it suggests the characterisation in the local file was chosen for its outcome rather than to describe what the entity does. Fixing it is not a matter of editing one sentence in whichever document is easier to change. It means deciding which description is actually true, correcting the other, and making sure the country-by-country figures agree with both. That is why we prepare the group and local layers as a single engagement wherever the timetable allows.
What is a transfer pricing policy, and is it the same as documentation?
No. The policy is the forward-looking statement of how your intercompany prices are set — which method for which transaction, which comparables, what happens when margins drift. The documentation is the backward-looking evidence that the policy was applied and produced an arm's length result for that year. Authorities read both, and a policy that the intercompany invoices do not actually follow is worse than none, because it establishes what you knew you should have done. See do you need documentation.
Do I need transfer pricing documentation?
If your company transacts with a related party in another country, in substance yes — the question is how much. Documentation is what shifts the burden: prepared before the filing deadline it evidences that your pricing was set on arm's length terms, and its absence is what turns a pricing adjustment into a penalty in several regimes. Volume of related-party dealings drives whether you need a local file, a master file, or a full benchmarking study. See do I need transfer pricing documentation.
