Transfer Pricing in Trinidad & Tobago

The transfer pricing challenge facing T&T groups

If your business buys from, sells to, lends to or shares costs with a connected company, your pricing is under scrutiny. Transfer pricing is the discipline of setting and proving that the prices charged between related parties — companies under common ownership or control — reflect what independent businesses would have agreed in the open market. This is the arm's-length principle, and it sits at the heart of how tax authorities worldwide allocate profit between jurisdictions.

For groups operating in Trinidad & Tobago, the exposure is real and growing. A local subsidiary that pays a foreign parent for management services, royalties, financing or imported goods is moving profit across a border every time it transacts. Where those prices cannot be justified, a tax authority can adjust them upward, claw back tax, and add interest and penalties. The same risk runs in reverse for T&T parents with overseas operations.

The difficulty is that getting transfer pricing right is rarely intuitive. It demands a clear view of who does what across the group, who owns valuable assets and who bears commercial risk — and then a credible economic analysis to show the pricing is fair. Many otherwise well-run businesses discover the problem only when a query lands, by which point the supporting evidence is hard to reconstruct after the fact.

Compounding the challenge is that transfer pricing touches almost every kind of intercompany dealing — the sale of goods, the provision of management or technical services, the licensing of brands and intellectual property, intra-group loans and guarantees, and the allocation of shared central costs. Each of these flows can shift profit across a border, and each calls for its own justification. A policy that is sensible for goods may be indefensible for financing; an approach that worked when the group was small may break down as it expands. Left unexamined, these inconsistencies accumulate quietly until a tax authority brings them into focus — usually at the least convenient moment.

Why transfer pricing matters in Trinidad & Tobago

Trinidad & Tobago's tax framework contains anti-avoidance and arm's-length provisions, and the Board of Inland Revenue (BIR) has every incentive to examine cross-border related-party dealings closely. With corporation tax currently levied at 30% (and higher rates for petrochemical and certain regulated sectors such as banks), the tax at stake when profit is shifted out of T&T can be substantial — and an adjustment can reach back across multiple years.

The international direction of travel reinforces this. The OECD's Base Erosion and Profit Shifting (BEPS) programme has pushed tax authorities globally toward standardised expectations: a clear master file describing the group's global business and pricing policies, a local file documenting the specific T&T entity's related-party transactions, and consistent country-by-country information for the largest groups. Even where a particular requirement is not yet codified locally, the analytical standard that BIR and counterpart authorities apply increasingly follows OECD guidance.

The practical consequence is that a T&T entity transacting with overseas affiliates should be able to produce, on request, a coherent explanation of why its prices are arm's length. If a BIR audit opens and that explanation does not exist, the conversation starts from a position of weakness.

How Andersen TT helps

We approach transfer pricing as risk management, not box-ticking. Our starting point is to understand your group's commercial reality — the flow of goods, services, finance and intellectual property between entities — and to map where the value is actually created. From there we build pricing policies that are both commercially sensible and capable of withstanding examination.

Because Andersen TT is the only accredited member firm of Andersen Global in Trinidad & Tobago, we do not work in isolation. Where your transactions cross borders, we coordinate with Andersen colleagues in the relevant jurisdictions so that the analysis holds together on both sides of the transaction — a coherent global position rather than disconnected local files that contradict one another.

Our partners lead the work directly. You are not handed to a junior team to assemble a templated report; you get experienced judgement on which transactions carry real risk, where to invest in robust analysis, and where a lighter touch is proportionate. And because we run no in-house statutory audit practice, our advice is independent and conflict-free — we are advising you, not protecting an audit relationship.

We are also pragmatic about cost. Comprehensive documentation has its place, but not every transaction warrants the same depth of analysis. We help you direct effort where the exposure is greatest — the high-value, high-visibility flows a tax authority is most likely to test — while keeping documentation for lower-risk transactions proportionate. The result is a defensible position that does not consume more time or fees than the risk justifies.

Our transfer pricing services

We support the full transfer pricing lifecycle, scaled to the size and complexity of your group:

• Transfer pricing risk reviews — a diagnostic of your related-party and cross-border transactions to identify where exposure is concentrated.
• Arm's-length policy design — setting intercompany pricing for goods, services, royalties, management charges and intra-group financing.
• Functional and value-chain analysis — documenting functions performed, assets used and risks assumed across the group.
• Benchmarking and economic analysis — selecting appropriate methods and comparable data to support the prices charged.
• Master file and local file documentation — OECD-aligned reports that explain the group's global policy and the local entity's transactions.
• Intercompany agreements — ensuring the legal paperwork reflects the actual conduct and the documented pricing.
• Controversy and dispute support — responding to BIR queries and adjustments, working alongside our BIR audit support team.
• Cross-border coordination — aligning the T&T position with Andersen Global member firms in counterpart jurisdictions.

Signs your business needs transfer pricing support

Transfer pricing is not only a concern for large multinationals. Consider seeking advice if any of the following describe your group:

• You are a T&T subsidiary of a foreign parent, or a T&T company with overseas subsidiaries or affiliates.
• You pay or receive management fees, royalties, licence fees or service charges between connected companies.
• You have intercompany loans, guarantees or cash-pooling arrangements across borders.
• You import from or export to a related party at prices that have never been formally tested.
• Your group's profits sit predominantly in one jurisdiction while activity happens in another.
• You are restructuring, expanding internationally, or preparing for an acquisition where related-party pricing will be examined — often surfacing during financial due diligence.
• You have received a query from BIR about prices charged to or from a connected company.

Why choose Andersen TT

Transfer pricing rewards a rare combination: the international reach to see both sides of a cross-border transaction, and the partner-level attention to get the local detail right. Andersen TT offers both.

Through Andersen Global, we plug into one of the world's most extensive transfer pricing networks, with specialists who do this work daily across dozens of jurisdictions. Yet engagements are led by Trinidad & Tobago partners with deep local knowledge and more than 50 years of combined experience — so you get Big-Four-calibre capability delivered with the speed and directness of a partner-led local firm.

Our independence is a genuine advantage. With no statutory audit arm, we have no conflict to manage and no incentive to steer you toward a position that suits anyone but you. For SMEs, family businesses and international investors — the clients the Big Four serve least attentively — that combination is exactly what defensible transfer pricing requires. To see how this fits your wider tax position, start with a tax health check, and review our corporate tax advisory service for the broader picture.

How we work

Our transfer pricing engagements follow a clear, proportionate process:

1. Scoping conversation. We map your related-party transactions and identify where the risk is genuinely material.
2. Fact-finding and functional analysis. We document who does what across the group and how value is created.
3. Economic analysis. We select the appropriate pricing method and benchmark against comparable arrangements.
4. Documentation. We prepare master file and local file reports aligned to OECD guidance and current BIR expectations.
5. Implementation and review. We align intercompany agreements with the policy and revisit the analysis as your business changes.

For wider context on the Trinidad tax landscape and recent fiscal measures, see our hub article on the 2026 Trinidad budget summary.