A business example
An Indian company charges its overseas group company for software-support work.
Describe the work
Record staff functions, resources used and responsibilities undertaken.
Assess the price
Document the pricing method and relevant comparison evidence.
Reconcile the charge
Connect the agreement and invoices to the actual services and calculations.
What this shows
A group-approved markup is a starting proposal, not proof by itself that the price meets the applicable arm's-length standard.
What it is often confused with
An internal invoice or group policy does not alone demonstrate an arm's-length price.
What to look at in your business
Identify covered relationships, transaction functions and supporting comparison evidence.
Context and further reading
This entry explains the business term. The related guide below provides the next layer of context; any applicable legal test depends on the transaction and relevant period.
Kosha.Services · Updated 2 October 2026