The Research On Transfer Pricing Methods For The Transnational Corporation In China

Since the reform and opening up, with the rapid development of globaleconomic integration, China has attracted a lot of international directinvestment. Until now, China has attracted foreign capital of most developingcountries, and business strategy of the multinationals in China need we takenotice on that. At present in the establishment of China internationalenterprises, most of them are the subsidiary and branch of the internationalenterprise, transfer pricing methods of the enterprise with a large proportion,so the study of the multinationals in China transfer pricing methods is veryimportant.This article from the study of the theory of the transfer pricing,combining with L group case, analysis the multinational enterprise in Chinatransfer pricing methods, this paper also discusses how to multinationalcompanies in China in reasonable use within the scope of the transfer pricing strategies to avoid risk and achieve enterprise management strategic goals.The paper first introduces the basic theory of transfer pricing methods,summarized the research situation of transfer pricing and the theoretical basis,and then formulated according to L group transfer price strategy operationpractice, from the analysis of the functional departments to L grouparchitecture setting on the influence of transfer pricing strategy, and thenanalysis the transfer pricing strategies with different comparison, through theintroduction of the L group transfer pricing strategy selection process,eventually got Transfer Net Margin Method (TNMM) is the most applicabletrading method for L group, and also analysis the limitation of Transfer NetMargin Method (TNMM), then provide suggestion and solution to recover it.This paper emphasis the theoretical knowledge and practical applicationof the policies and regulations, select L group as research background,combined with the knowledge from MPAcc course, show the enterprise foreffective tax planning, and make agreement with relevant governmentdepartments on tax, to support L group to control the tax risk and can achievethe win-win result between L group and government.