Global transfer pricing rules are becoming increasingly complex, and tax authorities around the world are stepping up enforcement. The heightened scrutiny puts additional pressure on multinational enterprises, many of which are already constrained by workforce shortages and limited resources.
To remain compliant without overwhelming their staff, many MNEs are turning to technology. From simplifying data collection to automating documentation, technology tools are helping companies manage growing compliance demands more efficiently while reducing the risk of audits, adjustments, and penalties.
Technology has shifted from being a helpful tool to becoming a core driver of success in transfer pricing compliance. Centralizing data, streamlining analysis, and automating documentation reduces manual workload, strengthens audit readiness, and ensures compliance processes are in line with changing demands. Technology also empowers cross-functional collaboration among tax, finance, legal, operations, and IT, which is essential for managing modern transfer pricing.
Beyond compliance, technology enhances governance, transparency, and accountability, allowing decision-makers at every level to access information and analysis in real time. Visualization platforms, in-year adjustment automation, and emerging AI capabilities are transforming transfer pricing from a reactive reporting exercise into a strategic lever that informs business planning, risk management, and global tax strategy.
As scrutiny from tax authorities intensifies and transparency requirements grow, the companies that will lead are those making continuous investments in the technology they use and integrating it with the expertise of in-house teams and external advisers.
I. The Changing Landscape of Transfer Pricing
Today’s global tax environment is constantly evolving, and MNEs face persistent challenges that demand proactive, coordinated responses. Tax authorities are no longer simply checking boxes; they are coordinating across borders, using sophisticated data analytics, and holding MNEs to increasingly exacting standards.
To stay ahead of heightened audit risk, companies must maintain accurate, jurisdiction-specific transfer pricing documentation while meeting expanding financial reporting obligations and preparing for the far-reaching implications of Pillar Two compliance.
The days of generic, high-level transfer pricing reports are over. Jurisdictions now expect detailed, localized documentation that aligns with OECD BEPS guidelines and addresses unique country-specific requirements. This means:
- Local comparable searches tailored to each jurisdiction;
- Jurisdiction-specific profit ranges supported by reliable data; and
- Language and format adaptations that align with local filing standards.
Each of these elements adds complexity, time, and cost. Without centralized processes and accessible historical data, meeting these obligations can overwhelm in-house teams and significantly increase compliance costs.
Pillar Two raises the stakes further by requiring MNEs to consider the interaction between transfer pricing policies and effective tax rates in every jurisdiction. In practice, this means accurate data collection, robust modeling, and scenario planning are now essential to avoid triggering additional liabilities. Tax authorities simultaneously are enhancing enforcement through greater data-sharing and advanced analytics, with audits frequently spanning multiple years and jurisdictions. Thus, even minor inconsistencies or gaps in documentation can potentially trigger adjustments and penalties.
Meeting these demands requires an approach grounded in collaboration and supported by technology. Early engagement across functions is key. Tax teams must work closely with finance and legal colleagues to align positions, while operations and IT provide the infrastructure to ensure consistent data flows.
This cross-functional approach enables organizations to establish standardized processes, eliminate silos, and maintain a single source of truth for transfer pricing data. When paired with automation, centralized platforms, and advanced analytics, compliance is transformed into a more strategic capability: reducing manual workload, improving accuracy, and providing the agility to respond quickly.
II. Technology as a Strategic Enabler
A. Data Collection and Analysis
One of transfer pricing’s biggest pain points is gathering and analyzing data. Tax departments often spend disproportionate amounts of time chasing down information across multiple business units and jurisdictions, time that could be better spent on analysis and strategic decision-making.
The complexity grows for MNEs with fragmented enterprise resource planning systems, where data is scattered across platforms acquired through mergers or acquisitions. This fragmentation often results in inconsistent accounting methodologies, missing information, and difficulty segmenting data appropriately for transfer pricing purposes.
Addressing these inefficiencies requires more than incremental, manual solutions and calls for the strategic deployment of technology that many organizations already have at their disposal. Internal productivity tools can be leveraged to streamline data gathering and consolidate information into centralized data lakes, using platforms such as Microsoft Fabric or Snowflake, to create a single “source of truth” for financial information.
By integrating these tools into daily workflows, MNEs can significantly reduce the administrative burden of data gathering, improve accuracy, and ensure that critical information remains both accessible and audit-ready.
B. Data Retention and Contingency Planning
While efficient data collection is essential, the ability to retain for multiyear audit readiness is equally important. Transfer pricing audits frequently occur years after the initial documentation is prepared, often requiring companies to substantiate historical positions. Without a structured and consistent retention process, organizations risk being unable to reconstruct the necessary information, a challenge further magnified by employee turnover and the loss of institutional knowledge.
To mitigate these risks, MNEs are turning to secure cloud platforms such as Microsoft Azure, Google Cloud, and SharePoint. These solutions provide centralized access, global scalability, and robust security, enabling organizations to maintain a reliable archive of transfer pricing data across jurisdictions.
C. Documentation Automation
With accurate data collection and structured retention processes in place, the next challenge is turning that information into documentation that can withstand scrutiny. Tax authorities now expect reports that are technically sound as well as being localized, precise, and aligned with country-specific rules.
Automation has made this task more manageable by streamlining repetitive processes and reducing the administrative burden on tax teams. However, while automated report writing tools have evolved significantly, they still face challenges in localization and technical accuracy. Overreliance on generic “robo-docs” can leave companies exposed if the reports fail to comply with jurisdiction-specific requirements.
Documentation tools powered by artificial intelligence addressing some of these challenges by offering the ability to automatically detect inconsistencies, suggesting jurisdiction-specific language, and adapting benchmarking analyses to local requirements. Still, technology should enhance human expertise rather than replace it. Oversight and professional judgement remain critical to ensure nuanced interpretation of rules and proper alignment with the realities of the business.
Given both the promise and limitations of these technologies, MNEs must be deliberate when evaluating automation solutions. They should focus on tools that improve efficiency—but which also enhance accuracy and adaptability. When assessing documentation automation tools, tax teams should focus on three key capabilities:
- Data upload functionality to seamlessly integrate internal financial data into reports;
- Comparable company integration to streamline benchmarking and reduce dependence on separate database services; and
- Jurisdiction-specific compliance features to meet local rules, formats, and arm’s length range requirements.
Selecting tools with these capabilities and leveraging AI where appropriate, allows organizations to embed automation into their compliance processes in a way that reduces manual workload, improves accuracy, and delivers documentation that is both efficiently prepared and defensible.
D. Transfer Pricing Adjustments
By strengthening data collection, retention, and documentation with modern technology such as centralized data platforms, cloud-based retention solutions, automation, or AI, MNEs can build a solid foundation for compliance. Yet even with these elements, a major challenge remains: ensuring that intercompany pricing withstands scrutiny throughout the year, not just at the time of filing.
MNEs historically have waited until year-end to make true-ups. But tax authorities—particularly customs and indirect tax authorities—are now scrutinizing these adjustments more closely. To reduce this risk, organizations are adopting in-year adjustment processes that proactively align intercompany pricing with target margins before year-end closes. By leveraging internal tools and dashboarding solutions, tax teams can automate these calculations, pull directly from centralized data sources, and even generate audit-ready documentation explaining both the rationale and methodology for adjustments.
Adopting these adjustments as a repeatable, technology-driven process reduces compliance risk and ensures that transfer pricing policies remain defensible and aligned with evolving expectations throughout the year.
III. Cross-Functional Collaboration
Establishing strong processes and implementing the right technology are critical, but not enough on their own. Long-term success requires people working together across functions to bridge strategy, execution, and oversight. Transfer pricing is not just a tax issue anymore, but a team effort that requires coordination of many functions inside an organization. The interplay includes:
- Tax ensures technical compliance with OECD and local rules;
- Finance integrates transfer pricing outcomes into forecasts, budgets, and financial reporting;
- Legal structures intercompany agreements and monitors regulatory changes;
- Operations ensures pricing policies reflect the reality of supply chains and value creation; and
- IT provides the infrastructure for secure, scalable data management and automation.
Cross-functional engagement drives governance, transparency, and accountability across the compliance lifecycle and creates the framework for managing risk, and technology plays a pivotal role in this collaboration.
Integrated platforms and tools provide the infrastructure for consistent processes, centralized data management, and clear audit trails, all of which strengthen an organization’s ability to withstand scrutiny. The most effective strategies combine these technologies with the expertise of in-house professionals and external advisers, striking the right balance between automation and human judgment.
In an era of increasingly complex rules, rising audit risks, and expanding global coordination among tax authorities, MNEs that invest in both the right technology and the right cross-functional solutions will be best positioned to maintain compliance, improve efficiency, and turn transfer pricing from a reactive obligation into a proactive strategic advantage.
IV. Increased Data Accessibility for Stakeholders
The cross-functional nature of transfer pricing means that a wide range of stakeholders are interested in the outcomes of transfer pricing analyses. Each group requires information presented in a way that aligns with their responsibilities and decision-making needs.
To meet each group’s unique requirements, transfer pricing analyses must be presented in a format that is tailored to its audience. Complex data tables may serve the tax team well, but senior management or operational leaders often benefit more from clear, visual summaries that highlight key trends, compliance risks, and performance against benchmarks.
Dashboarding can be a beneficial and cost-effective way to achieve this. By building interactive dashboards, MNEs can make it easy for different stakeholders to access the specific data they need, whether that’s a chief financial officer reviewing intercompany margin trends, an operations manager monitoring cost allocations, or legal reviewing the impact of policy changes on contractual agreements. Tools such as Power BI can be used to quickly develop and populate dashboards with existing data sources, ensuring that information is delivered in a meaningful, actionable format.
This results in greater transparency, faster decision-making, and stronger alignment between the functions responsible for transfer pricing compliance and strategy.
V. Outlook
The evolution of global transfer pricing will continue to challenge MNEs with greater complexity, higher scrutiny, and rapidly changing compliance and enforcement frameworks. Several trends will define the years ahead.
1. AI-Driven Pricing and Real-Time Compliance
Emerging technologies, particularly AI, are poised to revolutionize transfer pricing. AI can help automate benchmarking, detect variances in intercompany transactions, and enable real-time margin monitoring to ensure compliance before issues arise. AI will shift the focus from reactive adjustments to proactive pricing models that adapt to market and operational changes as they occur.
2. Anticipated Regulatory Shifts Requiring More Transparency
Global initiatives, from OECD guidelines to jurisdiction-specific mandates, are driving an increased demand for transparency. Tax authorities will likely expect granular, near real-time reporting that provides a clear narrative on how value is created and shared across the enterprise. This will increase the importance of unified data systems and visualization tools that can deliver the required insights instantly.
3. Continuous Investment in Technology and Talent
Meeting these demands will require ongoing investment in technology and talent. Cross-functional teams will need advanced analytical skills, regulatory expertise, and fluency in technology to harness new tools effectively. Integrating technology with the insights of in-house professionals and external advisors will remain the optimal balance for achieving both efficiency and accuracy.
Looking ahead, MNEs that embrace AI-enabled processes, proactive compliance strategies, and continuous investment in their technology and talent will be best positioned to navigate the increasingly complex transfer pricing landscape and shift compliance from an administrative burden into a competitive advantage.
This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.
Author Information
Samit Shah is a Transfer Pricing Principal in Grant Thornton’s National Tax Group. AJ Kindley is a Senior Manager in Grant Thornton’s International Tax and Transfer Pricing groups.
Grant Thornton LLP and GT Advisors (and their respective subsidiary entities) practice as an alternative practice structure in accordance with the American Institute of Certified Public Accountants Code of Professional Conduct and applicable law, regulations, and professional standards. Grant Thornton LLP is a licensed independent CPA firm that provides attest services to its clients, and GT Advisors and its subsidiary entities provide tax and business consulting services to their clients. GT Advisors and its subsidiary entities are not licensed CPA firms.
Write for Us: Author Guidelines
To contact the editors responsible for this story: Soni Manickam at smanickam@bloombergindustry.com;