Crossborder Intercompany

Definition

Transactions between related entities in different countries, creating a transfer pricing nightmare and tax optimization opportunity. It's where legitimate business meets aggressive tax planning, separated by a very fine line.

Example Usage

Our crossborder intercompany arrangements required 200 pages of transfer pricing documentation to justify to three different tax authorities.

Origin

Became complex with globalization of multinationals in late 20th century

Fun Fact

Crossborder intercompany structures are how tech giants park intellectual property in Ireland and route sales through the Netherlands—totally legal, mostly ethical, completely infuriating to tax authorities.

Source: International tax and transfer pricing practices

Related Terms

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aged receivables

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💰 Finance / Accounting

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evergreen loan

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💰 Finance / Accounting

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days payable outstanding

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💰 Finance / Accounting

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accounting

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💰 Finance / Accounting

Advanced

big bath

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💰 Finance / Accounting

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