Master file — what part of this actually needs a professional?
Some of it, yes — and we will say so on the call if that is the honest answer. The parts that are worth paying for are the ones where a missed election, a missed deadline or an unverified threshold costs more than the fee: it covers structure, business drivers, intangibles, intercompany financing and financial positions.
What if I have already filed and got it wrong?
That is a common starting point. We re-derive the position, identify whether an amendment or a disclosure route is the right vehicle, and tell you which one preserves the relief that is still available. The order matters more than the speed.
How long will it take?
It depends on the documents rather than on us. Once the pack is complete most filings turn around inside a fortnight; anything that needs a certificate from a tax authority runs on that authority's timetable, which we tell you at the start rather than at the end.
Who in the group should write the master file?
It has to be written where the group-level facts are known, which is normally the parent's finance or tax function, with input from the people who own the intangibles and run the financing. Local teams cannot write it, because they do not see the whole structure. What local teams can do, and should, is read it. A master file that a local reviewer recognises as a description of their own business is doing its job. One that reads as head office narrative gives a local authority its first reason to look harder at the entity in front of it.
What does the master file have to say about intangibles?
It describes which intangibles the group has, who owns them legally, who develops and maintains them, and how they are used and paid for between entities. The difficulty is that legal ownership and the activity that creates the value often sit in different places, and the master file is where the group states its position on that. Because the same document is read in every country, the description also has to be one the group is willing to stand behind everywhere. A description written to suit one jurisdiction becomes a problem in the next.
Does every country get the same master file?
In substance, yes, and that is the point of it. The same account of structure, business drivers, intangibles, financing and financial position goes to each authority that asks. Countries differ on language, on filing mechanics and on some local additions, but the group's description of where its value is created should not change from one filing to another. Tailoring the substance country by country is the failure the document was designed to prevent, and it is easily found: authorities exchange information, and inconsistent descriptions of the same group are exactly what an exchange programme surfaces.
Our local file contradicts the master file, how bad is that?
It is the specific problem documentation exists to avoid. The master file says where the group creates value; the local file says what the local entity does. If one describes an entity as a routine distributor while the other has it developing customer relationships or bearing market risk, a reviewer has been handed the argument. Fixing it means deciding which description is true, rather than editing the weaker one to match. Sometimes the local file is right and the group's account was written at too high a level; sometimes the local entity has been described more grandly than the facts support.
Do we need a master file if the group is small?
Requirements are set country by country, and they turn on the group's size and on the local entity's transactions, so the answer depends on where the group operates rather than on how it feels about its own scale. There is a second reason groups prepare one voluntarily. It is the only document that states the group's position on structure, intangibles and financing in one place, which makes every subsequent local file easier to write and harder to contradict. We look at each country the group files in and say where the obligation actually bites.
How often does the master file need updating?
When the facts it describes change. An acquisition, a new business line, a move of intangible ownership, a new intercompany financing arrangement, a restructuring of functions: each of those makes part of the document untrue, and an untrue master file is worse than a thin one. Beyond that, the review is a reading exercise. Take the previous version, read it against what the group actually did in the period, and mark anything that no longer describes the business. Most reviews produce a handful of changes; the ones that produce none are usually the ones where nobody read it.
What are the transfer pricing methods?
Five, in two groups. Three compare transactions: comparable uncontrolled price, resale price, and cost plus. Two compare profits: the transactional net margin method, and profit split. The OECD asks for the most appropriate method on the facts rather than a fixed hierarchy; the United States applies a best-method rule to similar effect. Selection is itself a documented judgment, and a method chosen without recording why is a weak position under audit. See our transfer pricing work.
What is the CUP method?
Comparable uncontrolled price. You find the price charged in a comparable transaction between unrelated parties and test your intercompany price against it. It is the most direct of the methods and the most persuasive when it fits, because it compares like with like at the transaction level. Its limit is data: close comparables exist for commodities and standard products, rarely for bespoke services or unique intangibles, which is where the margin-based methods take over. See our transfer pricing work.
