Transfer Pricing

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G.Ramesh (Querist)
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21 October 2009 Dear Experts,

Is there any standard procedure for fixation of Transfer pricing ? (Inter / Intra State Stock Transfer) Pls. advise me in this regard,Thanks.

CA SANJAY MUKHERJEE

CA SANJAY MUKHERJEE (Expert)
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21 October 2009 I guess you are asking for Inter Branch/Depot transfer of stock.

Usually the transfer of finished product is made on the basis of product price structure and it may be on cost price or may be at Sale price to Stockists. It depends on company's policy.

G.Ramesh

G.Ramesh (Querist)
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21 October 2009 Yes,inter branch only ...Thanks to Sanjay sir,is there any policy in State / central sales tax / VAT on Transfer Pricing?

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CA SANJAY MUKHERJEE

CA SANJAY MUKHERJEE (Expert)
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21 October 2009 No, since inter branch transfer is not sale this is outside the chargeability of Sales Tax/VAT/CST.

However Input credit is not fully available on Stock transfer to branches located outside of the state.

G.Ramesh

G.Ramesh (Querist)
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21 October 2009 Thanks for your valuable Clarification