Many big companies today work in more than one country. They may have offices, factories, or shops in different places. These companies sometimes buy and sell goods or services between their branches, a practice called transfer pricing. Transfer pricing strategi is important, but it can also be misused. That’s why many countries, including the UAE, follow global rules to ensure fair and correct prices. At JAKS, we support businesses with transfer pricing services across the UAE. We also help you understand your business’s value so you can make smart choices and grow confidently.

What is Transfer Pricing?

Transfer pricing means setting a price for goods, services, or things like brand names when one part of a company sells to another part in a different country. Companies use transfer pricing to manage profits and costs.

But if they set very high or very low prices, they can shift profits to countries with low tax rates, like the UAE, and pay less tax. This is why governments and global organisations have made strong rules to stop this kind of tax saving.

Why Are Global Rules Important?

Global rules help stop companies from avoiding tax. If companies move profits to low-tax countries unfairly, then:

• Governments lose tax money
• Some businesses get an unfair advantage
• Trade between countries becomes unbalanced

To avoid this, many countries follow the rules of the OECD (Organisation for Economic Co-operation and Development). One of the most important projects from the OECD is the BEPS (Base Erosion and Profit Shifting) plan.

UAE and Transfer Pricing Rules

The UAE has recently passed new tax laws, including a Corporate Tax. The UAE also follows transfer pricing rules based on global standards, such as the OECD guidelines.

Companies in the UAE must now:

• Follow the arm ‘s-length principle (prices must be like deals between unrelated companies)
• Keep proper documents to explain their prices
• File disclosure forms and transfer pricing reports, especially if they are part of a group working in other countries

These changes mean UAE companies must be more careful about setting internal prices.

Key Global Rules That Affect UAE Businesses

1. OECD Guidelines

These rules require related companies to treat each other as strangers in the market, ensuring fair pricing.

2. BEPS Action 

This rule requires companies to prepare and submit reports showing where they make profits, where they pay taxes, and what activities they engage in in each country.

3. Local UAE Regulations

The UAE has its own tax laws, along with global rules. Businesses must understand both local and global regulations to avoid penalties.

How These Rules Affect Transfer Pricing Strategies

1. More Paperwork

Companies must keep clear records and reports about setting prices between branches.

2. Higher Costs

Companies may need to hire tax experts, legal advisors, and consultants to help follow the rules.

3. Changing Business Structures

Some companies may move parts of their business to different countries or change their supply chain to make their structure more tax-friendly and legal.

4. Real Work Must Match Paperwork

If a company says its main profits come from the UAE, it must show that real business activity happens there. Tax authorities may question the setup if no employees or work is being done.

5. More Tax Audits

Tax offices in different countries now share more information, so there are more checks and audits to ensure that transfer pricing rules are followed correctly.

What Should UAE Companies Do?

• Understand the rules: Learn both global and UAE-specific transfer pricing rules
• Keep good records: Keep clear documents to support transfer pricing decisions
• Be transparent: Be open and honest in reports and tax filings
• Get expert help: Talk to tax and legal professionals to avoid problems
• Review prices regularly: Make sure your transfer pricing is up to date and fair

Transfer pricing is not just about setting prices between company branches. It is also about following the law, paying the right taxes, and building trust with governments. With the UAE now introducing corporate tax and following global rules, businesses need to plan better and work smarter.

Following global transfer pricing rules can help UAE companies avoid trouble and grow successfully. The key is to be clear, fair, and well-prepared.

At JAKS, we help businesses handle transfer pricing the right way. Our expert services  ensure that the prices between your company branches in different countries follow global tax rules. This helps you avoid penalties, reduce audit risks, and run your international operations smoothly. Stay compliant and tax-efficient with support you can trust. Call us at +971 503372712 or email [email protected]—we’re ready to help!