Analysis of transfer pricing in lending: Case study |of company x and a subsidiary

DOI

10.2991/apbec-18.2019.21How to use a DOI?

Keywords

Transfer Pricing; Interest; Tax; Implementation

Abstract

This study discusses interest payments on loan transactions between Company X and its subsidiary based on transfer pricing rules and Government Regulation No. 94 of 2010. The purpose of this study is to determine how transfer pricing is implemented and to analyze the tax savings on interest payments in the transactions between Company X and one of its subsidiaries. This research uses a qualitative research approach. The data are from Company X and its subsidiary, interviews with related parties, and a study of relevant literature. The result of the research concludes that interest free loan transactions between Company X and its subsidiary are not in accordance with the prevailing transfer pricing regulations in Indonesia and Government Regulation Number 94 Year 2010. It can be said that the company does not apply good tax planning because if it is seen from the calculation of the three schemes that the tax paid Company X on the scheme without interest is much greater than the tax on the scheme with interest.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Kristianti Hosiana
AU  - Christine Tjen
PY  - 2019/07
DA  - 2019/07
TI  - Analysis of transfer pricing in lending: Case study |of company x and a subsidiary
BT  - Proceedings of the Asia Pacific Business and Economics Conference (APBEC 2018)
PB  - Atlantis Press
SP  - 157
EP  - 164
SN  - 2352-5428
UR  - https://doi.org/10.2991/apbec-18.2019.21
DO  - 10.2991/apbec-18.2019.21
ID  - Hosiana2019/07
ER  -