The Complete TP Pipeline

Good morning. TechFlow is a clean mid-market file — €50M German SaaS parent with three controlled subsidiaries. Let me flag the priority risk areas: the India R&D cost-sharing at €2.8M is the largest outbound service and will draw scrutiny from Indian tax authorities given the CBDT's tightened stance on cost-plus margins for contract R&D. Second, the IP royalty to the US subsidiary — 4% of net sales — needs solid CUT/CUP support or we fall back to TNMM. I want the German local file delivered first as the master narrative, then cascade to India and the US.

Agreed on sequencing. I'll frame the workplan as follows: Phase 1 (weeks 1–4): data collection + business/industry/functional analysis building blocks — these are shared across all files. Phase 2 (weeks 5–8): benchmarking studies via smartZebra Transfer Pricing Pro + FT study for the intercompany loan. Phase 3 (weeks 9–12): local file assembly, QA, and sign-off. I'll set up the smartZebra comparable search parameters this week — SIC 7372 for the R&D benchmark and banking/credit spread data for the loan.

I'll start with the German local file as the base document. Data requests going out today: TechFlow India's trial balance, cost allocation sheets, and headcount breakdown for the FAR analysis. I've already pulled the group org chart from the last engagement — I'll update it with the UK entity which was incorporated in March 2024. For the FT study, I'll need the loan agreement and TechFlow India's latest audited financials for the credit rating waterfall. I'll have the business description draft ready for review by end of week.

One more thing — let's run /group-intel to get the full picture before we dive into content. I want the transaction matrix and the world view to confirm we haven't missed any flows. James, flag me if the India cost-plus margin falls outside the IQR — if it does, we need to discuss a pricing adjustment recommendation before we finalize the file.