Study On The Optimal Transfer Pricing Strategy Of Related Party Transactions Of ZBA Group Company

As more and more Chinese companies have started to go abroad to invest and took advantages of global resource allocation, transfer pricing in related party transactions becomes vital in this process. It is important to choose proper transfer pricing strategies to enhance the profitability of corporations through tax planning. What’s more, according to the optimization of transfer pricing method in ZBA Corporation and understand the principles of transfer pricing in a multinational company, it helps to reduce loopholes and improve relevant tax laws, and provide legal basis for taxation in China. This will in return do well to Chinese companies’ operation and increase national tax income.By analyzing the ZBA company production operating conditions and related party transactions situation, clear ZBA in transfer pricing of related party transactions exist problems and thus leads to the company’s operating conditions change. And from five kinds of legitimate transfer pricing methods, through the analysis and comparison, it is clear that the transfer pricing strategy of ZBA company can achieve the purpose of the transfer pricing strategy optimization. Through the optimization of the reasonable transfer pricing strategy to effectively reduce the tax burden of enterprises, bring some additional economic benefits for the enterprise, and makes the enterprise liquidity is more abundant,can use more flexible business strategy, to enable enterprises to more vitality, from the point of view of the corporation as a whole can reduce the company’s overall operating costs, and can effectively enhance the enterprise’s comprehensive competitiveness.The methodologies of this paper includes literature research, qualitative analysis, case study method, and experience summarization method.Research conclusion: By optimizing transfer pricing in related party transactions among ZBA companies, the management ability, profitability and competitiveness are strengthened. The strategies mentioned in this paper could be widely used in Chinese multi-national corporations and provide the basis for dealing with transfer pricing issue in multi-national related party transactions.