Transfer Pricing
Since the beginning of the globalisation of the world’s economy, a series of changes has occurred in regard to the manner in which companies visualize their reality regarding tax payments and the precautions and safeguarding that they should practice when complying with their tax obligations.
International organisms such as the “Organization for Economic and Corporate Development” (OECD) and the regional governments, have signed treaties to create different tax models directed towards primarily avoiding double taxation, in a continuous search by tax authorities and taxpayers in each country to achieve fair tax payments.
According to international regulations and the tax laws of the Bolivarian Republic of Venezuela, published in Extraordinary Official Gazette 5.390 of October 22, 1999 and reformed in Extraordinary Official Gazette 5.566 of December 28, 2001, all taxpayers carrying out operations with related parties must file, together with their annual Income Tax return, a complementary declaration with the data of the various transactions carried out with related companies that involve a transfer pricing analysis.
Furthermore, the documents needed as proof to justify the transfer pricing conducted between related parties, the methods applied to determine the same, and the criteria of comparison used to conclude that the method applied is the most appropriate for each transaction must also be kept on file.
Baker Tilly Venezuela has the experience, know-how and necessary resources to prepare, support, and present the information related to transfer pricing, for the purpose of complying with the legal standards.
Our Services:
Our services consist in carrying out the price study that would serve our clients to both, support the monetary movements made during their transactions between related parties and to comply with duties to save the documentation needed as proof of the transfer pricing.
We offer our clients extensive managerial and financial information of the companies that carry out similar functions, which is a valuable benchmarking tool.
We review and advice in regard to the policies derived from the application of transfer pricing policies, for the purpose of maximizing the efficiency in fiscal costs that such application generates in international taxations.
We apply methodology and concepts of transfer pricing to evaluate intangible property.
We apply concepts of restructuring and re-engineering to the different regulatory, financial, and commercial aspects so as to optimise cash flows and thus, stockholders’ value.
Internal Audit
Organizations nowadays require their internal audit to be focused on business needs for the purpose of efficiently administrating their critical risks and operations, as well as for identifying opportunities to improve their business processes. In this sense, Internal Audit has changed its traditional role based on the review of transactions for a more proactive role in the strategic area of business. The modern approach of the Internal Auditing process within the organizations requires that Internal Audit understands the business of the organization, its industry, and best auditing practices to adequately assess management and to identify opportunities for improvement. Likewise, Internal Audit should develop a more efficient and effective approach, based on a wider knowledge of the business, of the industry, and of the related risks.
The Internal Auditing Services of Baker Tilly Venezuela, are designed to assist the organization in transforming the Internal Auditing process into a support centre for the improvement of operations, keeping well in mind the following aspects as goals:
• Offering added value to the Board of Directors or Administration Counsel, Audit Committee, General Management, and Financial Management.
• Focusing on identifying, evaluating, and mitigating the risks related to business strategies and objectives.
• Identifying the opportunities to improve business processes.
New services are described as follows:
• Outsourcing services
• Co-sourcing services
• Diagnosis and Re-design of the Internal Auditing Function
• Evaluation Approach to Business Processes and Internal Control
• Enterprise Risk Management advisory services
• Sarbanes-Oxley Act Services
• Services related to Corporate Governance
• Training
Taxes
Baker Tilly Venezuela has an extended background in the rendering of tax related services. For years, the Tax Consulting Division has had highly qualified professionals that offer clients the necessary support so as to attend to this activity that is fundamental among their business activities.
Our services are performed with a financial, accounting, and legal vision of the aspects involved in the economic operations of the companies, thus enabling proper analysis of the same.
On an international basis, we can count on the different firms pertaining to Baker Tilly International, which assures the necessary advisory services for expanding clients’ businesses at a worldwide level.
In general, the tax services offered by our Firm are the following:
• Preparation and assistance in the elaboration and review of Income Tax Returns in Venezuela
• Review of the non-lapsed tax obligations
• Special audit reviews
• Due diligence in merger and takeover processes of companies
• Advisory services for streamlining tax loads
• Tax and risk consulting services
• Application of treaties to avoid double taxation in operations between Venezuela and foreign countries
• Advisory services to individuals in patrimony structure analysis
• Specialized support in contentious tax processes
• Application of quantitative, theoretical tools in judicial and legal matters
• Assistance in the processes for legal ordinance reforms
• Professional development
• Transfer pricing
• Outsourcing in Value Added Tax matters
• Income taxes, Municipal taxes
Auditing
Our auditing services are based in the use of the General Auditing Norms in Venezuela (DNA) and the International Auditing Norms (NIAS), as well as in the use of the best audit global practices which are under a constant process of review and quality control.
Our Services:
• Audit of financial statements
• Limited reviews
• Previously agreed procedures
• Translation of financial statements into foreign currency
• Inflation adjustment
• Consolidation
• Review of reports
• Adoption and review the application of international accounting standards IFRS
Legal
Baker Tilly Venezuela, has a legal counsel office that carries out legal practice in the tax and mercantile area, with special emphasis on attending the requirements and needs that are typical for business activities. Said office bases its professional practice both on the ethical and technical solvency of its professional staff as well as on the commitment of providing services of high value and professional quality. At the same time, the main objective of our services is to comply with the criteria of opportunity and practicability when attending to our clients’ needs. Our experience guarantees proper legal and financial understanding of the practical aspects submitted for our consideration, allowing us to work in a cooperative manner with other legal, auditing, and professional advising firms of the most diverse fields of activity.
Specialization areas
Mercantile area: our Legal Counsel is qualified to render the following services:
• Legal advisory and consulting services related to mercantile laws;
• Incorporation of companies, restructuring, takeovers, mergers, divisions, and liquidations;
• Legal assistance in the purchase and sale of companies, businesses and assets and legal auditing of companies (“due diligence”);
• Preparation of all types of commercial agreements, including contracts for sale, option, distribution, and franchise.
• Advisory services regarding foreign investments in Venezuela.
Tax area: Our Tax Office offers expertise in the following two tax specialities:
• Tax related consulting
• Assistance in tax inspection
Outsourcing
Baker Tilly Venezuela, has a team of professionals dedicated to provide outsourcing services in non-core areas of business. We provide high quality services with absolute confidentiality to support our customers and generating value added.
We provide services of:
• Administrative Outsourcing
• Accounting Outsourcing
• Payroll Outsourcing
• Tax compliance
Among the activities we perform, we have:
• Processing accounting transactions of the company.
• Preparation of basic financial statements and special reports required by management or required by the company headquarters.
• Definition of internal control policies according to business needs, in order to ensure efficient management and reliable and timely accounting records.
• Preparation and submission of monthly tax files.
• Preparation and submission of annual income tax files.
• Cash Management which includes preparation of checks,
payments vouches and suppliers payments.
• Oversight of accounting.
• Advice on the application of accounting standards and tax.
• Personnel and confidential payroll preparation
• Preparation of financial statements adjusted by inflation.
