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Appendix 6: Arm's length methodologies

Last updated 8 November 2011

The arm's length pricing methodologies should be identified using the codes listed below.

Arm's length pricing method

Code

Comparable uncontrolled price method

1

Resale price method

2

Cost-plus method

3

Profit split method

4

Transactional net margin method

5

Marginal costing

6

Cost-contribution arrangement

7

Apportionment of costs

8

Apportionment of income

9

Fixed mark-up applied to cost

10

Fixed percentage of resale price

11

Other arm's length methods

12

No transfer pricing method used

13

Note: The 'fixed mark-up applied to cost' and 'fixed percentage of resale price' methodology codes should be used when 'administrative practice' as described by Taxation Ruling TR 99/1 Income tax: international transfer pricing for intra-group services has been utilised to set the pricing of intra group services.

QC24292