Transfer pricing and its place at Turkish tax system

In this work, tax administrations and the transfer pricing that constitute the agenda of the firms are analysed under the title of ?Transfer Pricing and its place at Turkish Tax System?. Transfer pricing is a method and accounting technique used in transfer of goods or service between the relevant firms. Transfer pricing may also be used in evaluating the performance of group units in the economic sense as well as for providing tax advantage. Transfer pricing is sometimes used by the firms for benefit purposes, and it may lead to capital movement between the countries and abstention from tax. Tax administrations make laws in order to prevent the possible negative effects of this situation on tax revenue. For this purpose, the existing corporation tax law has been changed. New Corporation Tax Law numbered 5520 has brought transfer pricing rules appropriate for ?Transfer Pricing Guide for international establishments and Tax Administrations? of OECD. It has been aimed to prevent tax loss and reduce the capital movement in our country with the new regulation. For transfer pricing, many countries in the world have followed OECD guide like Turkey. In the subject analysed, it has been mentioned that Turkish Tax System has shown improvement for harmonizing with the international tax legislation for transfer pricing subject. It has been specified that the change made with Corporation Tax Law numbered 5520 is not sufficient, and the problems that will be experienced in the application and the solution suggestions have been mentioned, and it has been reminded that a transition process is required for legislation change. Keywords: Transfer Pricing, Multinational Companies, Hidden Profit, New Corporate Income Tax Code