Accounting Solutions Singapore Editorial Team · Last reviewed 15 October 2026
Transfer pricing is about the prices related companies charge each other. IRAS expects those prices to look like what unrelated parties would agree. Whether you also need written documentation, and whether you fill in an extra form with your tax return, depends on size tests that changed for some transactions from YA 2026. This post sets out the tests, a worked example and what IRAS asks you to keep.
At a glance
| Question | Short answer |
|---|---|
| What is the rule? | Related-party transactions should be at arm’s length, meaning the price unrelated parties would agree in comparable circumstances |
| Who needs transfer pricing (TP) documentation? | Generally companies with gross revenue above S$10 million for the basis period, plus related-party transactions above the thresholds in the table below |
| When must it be ready? | By the filing due date of the tax return for that year |
| How long to keep it? | At least 5 years from the end of the basis period of the transaction |
| If IRAS asks for it? | Submit within 30 days of the request |
| What if you don’t comply? | A fine of up to S$10,000 |
| Related Party Transaction (RPT) form? | Needed with Form C if related-party transactions exceed S$15 million; not with Form C-S |
What “arm’s length” means in practice
IRAS describes a three-step approach:
- Comparability analysis. Understand the transaction and find comparable dealings between independent parties.
- Pick the method. Choose the most appropriate transfer pricing method and the tested party.
- Determine the arm’s length result. Compare what you actually charged with that result.
Related parties include group companies, and a head office and its branches, so intra-group management fees, loans, goods and royalties all count.
Do you need transfer pricing documentation?
Documentation is required when your company’s gross revenue from its trade or business is more than S$10 million for the basis period, and the related-party transactions go beyond the thresholds below. Gross revenue excludes passive income and capital gains or losses. IRAS’s guide also sets out how the revenue test applies across the relevant and two preceding basis periods, so check paragraphs 6.10 to 6.14 of the guide if you are near the line.
Thresholds for each category of related-party transaction:
| Category | YA 2025 and before | YA 2026 onwards |
|---|---|---|
| Purchase of goods from related parties | S$15 million | S$15 million |
| Sale of goods to related parties | S$15 million | S$15 million |
| Loans granted or taken | S$15 million | S$15 million |
| Services provided or received | S$1 million | S$2 million |
| Right to use movable property | S$1 million | S$2 million |
| Lease of any property | S$1 million | S$2 million |
| Guarantees | S$1 million | S$2 million |
| Any other transaction | S$1 million | S$2 million |
Some transactions are excluded from these totals. One example is routine support services charged at the 5% cost mark-up that IRAS accepts as an administrative practice. We have not reproduced the conditions for that practice here, so read paragraph 14.29 of the IRAS guide before relying on it.
Example (illustration only)
Both companies are with a 31 December year end, looking at YA 2026.
| ABC Pte Ltd | DEF Pte Ltd | |
|---|---|---|
| Gross revenue for the basis period | S$14.0m | S$6.5m |
| Management fees paid to its parent | S$2.4m | S$2.4m |
| Goods bought from group companies | S$3.0m | S$1.0m |
| Documentation needed? | Yes. Revenue is over S$10m and service payments are over S$2m | No on the revenue test, so documentation is not required (it still has to price at arm’s length) |
ABC Pte Ltd has to hold TP documentation by its Form C filing due date. DEF Pte Ltd still needs to charge its parent at arm’s length. It just isn’t required to write up the analysis.
The related party transaction form
Separately from documentation, a company must complete the RPT form if its related-party transactions exceed S$15 million for the YA. Points from IRAS’s guidance:
- The form is part of Form C. Companies filing Form C-S don’t complete it, although IRAS may ask for the information separately.
- The total is worked out at company level, not group level, and counts local and cross-border transactions.
- It combines amounts in the income statement (sales and purchases are added, not netted) with year-end loan and non-trade balances with related parties.
- Directors’ fees, compensation to key management, dividends and purchases of tangible or intangible assets are left out of the total.
What to keep and for how long
- Timing. Prepare documentation not later than the tax return filing due date. IRAS describes this as “contemporaneous”, meaning not written with hindsight.
- Retention. At least 5 years from the end of the basis period in which the transaction took place.
- On request. Provide it to IRAS within 30 days.
- Refreshing. If the details remain accurate, IRAS lets you use simplified documentation to refresh the full document once every three years.
- Penalty. Failing to meet the documentation requirements can lead to a fine of up to S$10,000. IRAS also applies adjustments and may charge a surcharge on them. The rate and the remission rules are in section 9 of the IRAS guide.
If your group has overseas affiliates, our group consolidation page explains how the group figures are brought together, and the corporate tax page covers the annual filing.
Questions we get asked
Does transfer pricing apply to a small company with one overseas parent? The arm’s length rule applies to any related-party dealing. Documentation is a separate test based on revenue and transaction size.
Is the S$15 million RPT figure the same as the documentation threshold? No. The S$15 million RPT form test is a reporting rule in Form C. The documentation tests use the table above, and for services and similar items they are lower.
We file Form C-S. Do we still need documentation? The RPT form isn’t required with Form C-S, but the documentation rules depend on gross revenue and transaction size, not on the form you file. Check the tests above.
What if IRAS adjusts our prices? IRAS can adjust profits so the related-party transaction is taxed as if at arm’s length. Documentation prepared on time is the best evidence of how you set the price.
Sources
- IRAS, e-Tax Guide: Transfer Pricing Guidelines (Ninth Edition, 4 June 2026)
- IRAS, Reporting of Related Party Transactions (updated July 2026)
- Income Tax Act 1947, sections 34D and 34F; Income Tax (Transfer Pricing Documentation) Rules 2018
This is general information, not professional advice for your specific situation. Thresholds and rules change, so confirm them on IRAS before relying on them.