When filing an income tax return, profit-seeking enterprises undertaking Controlled Transactions shall prepare the related documentations attesting to the accuracy of the taxable income, and produce them as required when the taxation authorities-in-charge conduct the investigations. The related documents are as follows:
1.A comprehensive business overview;
2.A description of the organizational structure;
3.Summaries of controlled transactions;
4.A transfer pricing report, which should at least include the
i.An industry and economic circumstances analysis;
ii.Functional and risk analysis of all of the participating
parties in the controlled transactions;
iii.A description of instances compiled by the arm’s-length
iv.A description of the comparables selected;
v.A comparability analysis;
vi.Where business restructuring is involved, an assessment of whether the
allocation of profits is at arm’s length;
vii.A description of the selected best method and rationale, and
an explanation of why alternative methods were not selected;
viii.The transfer pricing method of the related parties;
ix.The conclusion of the measurements made under the method
selected by the best method rule;
x.Whether the results of the controlled transactions conform
to the arm’s-length standard;
xi.Adjustments based upon the results of arm’s-length
5.Associated enterprises statements and consolidated reports of the associated enterprises and other materials as required pursuant to Article 369-12 of the Company Law.
6.Other documents in relation to related parties or controlled transactions, which may affect pricing, if any.
When filing profit-seeking enterprise income tax return, whether or not required to disclose the information regarding related parties and transactions between the profit-seeking enterprises and such related parties on Pages B2 to B5 of the tax return form, Profit-seeking enterprise has the obligation of preparation of documents regarding the comprehensive business overview, organization structure, summaries of controlled transactions and others remains mandatory in accordance with the Article 22 of “The Regulations Governing Assessment of Profit-Seeking Enterprise Income Tax on Non-Arm's-Length Transfer Pricing”.