Comparative Analysis of Legislation on Transfer Pricing in Neighboring Countries

Abstract

: This paper analyzes the problem of the influence of legal requirements related to the calculation of transfer prices on the amount of taxable profit and the amount of income tax. It also deals with the compliance of the legislation in the Republic of Serbia with the relevant requirements of the European Union, as well as with the regulations of neighboring countries. Given that a large number of companies do business with related parties both in the country and in neighboring countries, the emphasis was placed on analyzing the justification of harmonizing transfer prices with prices at "arm's length" and on comparing the requirements imposed on taxpayers by the legal regulations of the Republic of Serbia, the Republic of Croatia, the Republic of Montenegro, and Bosnia and Herzegovina.