Transfer pricing consultation

tiemadmin • 17 July 2025

New UK transfer pricing rules could mean more reporting and fewer exemptions for mid-sized businesses. The government is consulting on proposals to tighten compliance and align with global standards. One key change would remove the transfer pricing exemption for medium-sized enterprises, keeping it only for small businesses. Another would introduce a new reporting requirement, the International Controlled Transactions Schedule (ICTS), to give HMRC more visibility over cross-border related-party transactions. These reforms aim to curb profit shifting, protect the UK tax base and simplify the rules for those who follow them.

Transfer pricing refers to how prices are set for transactions between companies that are part of the same group, especially when these transactions cross international borders. These prices must follow the “arm’s length principle,” meaning they should reflect what unrelated companies would charge under similar circumstances. This helps ensure that profits are taxed fairly where economic activity actually takes place.

The UK government is seeking feedback on two proposed changes to its transfer pricing rules. These proposals aim to protect the UK’s tax base from multinational enterprises (MNEs) shifting profits overseas, and to bring the UK in line with global best practices.

The first proposal suggests changing the current exemption from transfer pricing rules for small and medium-sized businesses (SMEs). In particular, it proposes removing the exemption for medium-sized enterprises but keeping it for small ones. The government also wants to update definitions and thresholds to make the rules clearer and easier to follow.

The second proposal would introduce a new reporting requirement called the International Controlled Transactions Schedule (ICTS). This would require MNEs to report cross-border related-party transactions to HMRC. The information would help HMRC better assess risk, reduce audit times, and support fairer, more efficient tax compliance whilst at the same time limiting extra burdens on businesses.

< Older Post

Newer Post >

Budgeting and forecasting in a period of lower confidence

by tiemadmin • 9 February 2026
Many business owners are entering the new year with a sense of caution. Confidence across the UK business community has softened, driven by continued cost pressures, uncertainty over tax policy and The post Budgeting and forecasting in a period of lower confidence appeared first on Feldon Accountancy.

Business rates support and cash flow for hospitality businesses

by tiemadmin • 9 February 2026
Hospitality businesses continue to operate in a challenging environment. Rising wage costs, energy prices and supply chain pressures have all placed strain on margins. Against this backdrop, recent The post Business rates support and cash flow for hospitality businesses appeared first on Feldon Accountancy.

Eligibility for Business Asset Disposal Relief

by tiemadmin • 5 February 2026
Business Asset Disposal Relief (BADR) can significantly reduce the Capital Gains Tax due when selling a business or shares, but with higher rates coming from April 2026, timing and eligibility matter The post Eligibility for Business Asset Disposal Relief appeared first on Feldon Accountancy.