# Tax optimization strategy for price transfer in International trade Price transfer (transfer pricing) is a tax planning method commonly used by multinational companies in international trade, but I need to emphasize that any tax planning should be carried out within the framework of legal compliance. ## Compliant price transfer method 1. **Understand transfer pricing rules** -Follow OECD Transfer pricing guidelines -Familiar with the requirements of the Arm's Length Principle of independent transactions in various countries -Master the transfer pricing document requirements of different countries 2. **Reasonable selection of transfer pricing methods** -Comparable uncontrolled price method (CUP) -Resale price Method (RPM) -Cost addition method (CPM) -Transaction net profit method (TNMM) -Profit division method (PSM) 3. **Establish functions and risk analysis** -Reasonable allocation of functional positioning of enterprises within the group -Match profits with value creation and risk-taking ## Legal tax planning strategy 1. **Set up a regional headquarters or operation center** -Set up regional management centers in areas with low tax rates but commercial substance - Ensure that the management center has actual decision-making functions and reasonable staffing 2. **Intellectual property planning** - Hold and manage intellectual property rights in appropriate jurisdictions - Charge a reasonable fee for the use of intellectual property rights 3. **Supply chain reorganization** -Re-plan the global supply chain based on business substance - Ensure that functions, assets and risks match ## Compliance points - Prepare adequate transfer pricing documents -Conduct regular transfer pricing policy reviews - Consider Advance pricing arrangement (APA) - Avoid aggressive tax avoidance arrangements -Pay attention to international anti-tax avoidance trends (such as the BEPS Action Plan) Tax optimization should be based on legal compliance and oriented to actual business purposes, not simply for tax benefits.