Research On Transfer Pricing Of Internet Enterprises Under VIE Mode

The integration of international economic provides a good environment for the development of transnational enterprises.Under the guideline of "Bring in" and "Go globally ",foreign investment and overseas listing are developing rapidly in recent years in China.Nowadays,it's not a mysterious method to use VIE mode in the Internet enterprise for the purpose of listing overseas and operating in China.However,the research on transfer pricing of Internet enterprises under VIE mode is still lack of theoretical and practical guidance.Transfer pricing is mainly used for tax planning in transnational economic activities.For Internet enterprises under VIE mode,transfer pricing is not only used for tax planning,but also an important method to transfer the operating interests of domestic entities to overseas listed entities.As the international tax authority pays more and more attention to the legislative norms and jurisdiction monitoring of transfer pricing,Internet enterprises under VIE mode are facing unprecedented supervision and tax risks in the operation of transfer pricing.How to balance the purposes of profit transfer and tax law compliance is the difficulty and pain point of Internet enterprises in using transfer pricing under VIE mode,which is also the research content of this paper.In this paper,AL Corporation is taken as the research object.It based on the purposes of profit transfer and avoiding tax risks.The functions and corresponding risks of the WFOE and VIE of AL Corporation under the compound business are analyzed in depth to determine the appropriate transfer pricing method.The comparative analysis data are obtained through the transfer pricing method,and the profit interval conforming to the principle of independent transaction is determined as a reasonable profit level of transfer pricing.Based on the historical financial data of AL Corporation,this paper analyzes the rationality of the historical transfer pricing of AL Corporation,and formulates the transfer pricing scheme,so as to achieve the purposes of profit transfer and tax risk avoidance.