Research On Tax Risk Of Cross-border Cash Pooling Of Enterprise Groups

As companies around the world grapple with the economic impact of the COVID-19 pandemic,increasing the liquidity of financial resources has become a major focus for man y companies.Cash pooling is a cash management tool used by multinational enterprises to effectively manage short-term liquidity needs.This effective intra-group financing tool red uces MNEs’ dependence on third-party financing.In essence,by offsetting the debit and cre dit accounts,it lowers the cost of financing on the corporate side.Cash pooling control and centralized management within a single entity within a group of MNEs can also enable part icipants to benefit from optimisation of shared resources,better risk management and better positioning of third-party banks and financiers.If the cash pooling contains accounts locat ed in more than one country(region),it is called "cross-border cash pooling".To study the tax risk of cash pooling transfer pricing is not only beneficial to standardize the operation of cash pooling,but also beneficial to reduce the tax risk of enterprises.At the same time,it can provide a theoretical reference for multinational enterprise groups in the setting of capi tal financing,and warn enterprises of the potential transfer pricing risks of affiliated transac tions in the operation of cash pooling,thus emphasizing the importance of tax risks to enter prise groups.Based on the operation of cross-border cash pooling,this thesis analyzes the possible tax-related risks in transfer pricing in the operation of cross-border cash pooling,and on this basis,puts forward countermeasures and suggestions to prevent the tax-related risks in transfer pricing of cross-border cash pooling.First of all,this is the pool fords the tax risk,provides a theoretical basis of systematic analysis of the pools related concept,the transfer pricing theory and the transfer pricing tax risk theory,and according to the current situation of the development of cross-border cash pooling and tax environment,analyze the enterprise group pools inside connection transacti on in principle possible fords the tax risk points,They are the pricing does not conform to the principle of independent transaction,the improper selection of transfer pricing method,the improper selection of comparable enterprises and indicators,the inadequate preparation of data for the same period and other aspects.At the same time,the thesis summarizes the main causes of the formation of tax-related risks of corporate cash pooling,including lack of tax-related risk awareness,insufficient investigation of tax-related issues in transfer prici ng,lack of comparable information of unlisted enterprises and lack of corresponding measu res,resulting in the expansion of risk scope.Secondly,the case of CP Group’s cross-border cash pooling based on the financial com pany model is selected to analyze the tax-related risks in transfer pricing.Through to the CP group in cross-border cash pooling specific analysis of the actual situation of the interna l connection transaction,transaction net profit method as the main way of transfer pricing of CP financial company,and according to industry characteristics and comparable index chose five comparable companies carried out comparative analysis,on cross-border proble ms of transfer pricing tax risk pools are summarized.Finally,from the perspective of enterprises,strategies and suggestions are put forward to prevent the tax-related risks of cross-border cash pooling.First,a fair capital transaction price is established by evaluating the credit rating of member enterprises of the cash poolin g and referring to the capital transaction price of non-related parties.The second is to establ ish a systematic transfer pricing mechanism by selecting scientific and reasonable transfer pricing methods,selecting appropriate comparable enterprises and indicators,and monitori ng the actual results and the gap between them and legal policies at any time;The third is to improve the compliance of the data of the same period by improving the data of the same period in each region and improving the professionalism of the internal personnel of the ent erprise;Fourthly,enterprises should apply for advance pricing agreement and hire transfer pricing experts to demand external transfer pricing support.