Base Erosion and Profit Shifting (BEPS) is the OECD framework that closed the gaps multinational groups once used to shift taxable income to low-tax jurisdictions. Since 2017, the framework’s 15 Action items, and most visibly Action 13 on transfer pricing documentation, have been adopted into the Income Tax Act in India and into the equivalent tax codes in the United States, Canada, the United Kingdom, the United Arab Emirates and most other G20 economies. Multinational groups with consolidated revenue above the reporting thresholds in any of those countries now sit under a single, interlocking documentation regime, with the Master File, the Local File and the Country-by-Country Report (CbCR) forming the spine. Innobrant works as a BEPS compliance consultant to multinational groups headquartered in India, the United States, Canada and the UAE that need to produce all three of those documents on time, in the format the tax authorities expect, and consistent with their actual transfer pricing positions. Our work is led by Director, CA Jashwanth Pasupuleti, and supervised by qualified financial consultants who have prepared documentation for groups across software services, e-commerce, manufacturing, professional services and financial services.
What BEPS Compliance Actually Means for Indian-Headquartered Groups
The Indian transfer pricing regime adopted the BEPS Action 13 three-tier documentation structure with effect from financial year 2016 onward, and the Income Tax Act now codifies the obligation under the relevant transfer pricing sections (formerly 92D, 92E and 286 of the 1961 Act, mapped into the Income Tax Act, 2025 framework). In practice, a group headquartered in India with consolidated revenue at or above the prescribed threshold (currently INR 6,400 crore for CbCR obligations and lower thresholds for Master File and Local File) must file all three components within the deadlines linked to its tax return.
The Master File describes the group’s overall structure, the nature of its business, its intangibles, intra-group financing and a consolidated view of its transfer pricing policies. The Local File describes the Indian entity’s intra-group transactions in detail with the economic analysis that supports the prices charged. The CbCR is a country-by-country breakdown of revenues, profits, taxes paid, employees and tangible assets that the Indian competent authority then exchanges with peer tax authorities under the relevant treaty.
Where Innobrant adds value is in keeping these three documents internally consistent. It is common to see a Local File that claims one transfer pricing method while the Master File implies another, or a CbCR that allocates profits to a jurisdiction the Local File does not describe at all. Those inconsistencies invite scrutiny. Our financial consultants build the three documents from the same underlying functional, asset and risk (FAR) analysis so that the story is the same in every direction.
BEPS Action 13 Documentation, Step by Step
The first step in any engagement is the FAR mapping. We work with the group’s tax, finance and operations teams to document who does what across the group, where the value-adding activities sit, which entities own the intangibles, who carries the inventory risk, the credit risk and the foreign exchange risk, and how those facts flow through to the intercompany contracts. This map is the foundation; the documentation is the narrative that sits on top of it.
The second step is the comparability search. For each tested party and tested transaction, we run a fresh benchmarking study using OECD-recognised databases such as TP Catalyst, RoyaltyRange and Capital IQ. We document the search strategy, the qualitative and quantitative screens applied, the rejected comparables with reasons, and the final set of comparables with the interquartile range of operating margins or royalty rates that the tested party should fall within.
How Innobrant Engages — A Partner-Led Model
Every BEPS engagement is led by Director, CA Jashwanth Pasupuleti, with direct partner involvement on the FAR analysis, the comparability search rationale, and the final review. Our financial consulting team in Hyderabad executes the day-to-day workpapers, drafting and benchmarking, and our review team carries out the consistency check before any document leaves the firm. Clients get one named partner contact, not a rotating account team.
We do not position on lower fees. We position on direct access to the engagement partner, on consistency between the three documents, and on documentation that holds up at audit. For groups that prefer a per-dedicated-resource model, we can also engage on a managed-services basis where an Innobrant team works as an extension of the in-house tax function.
BEPS Compliance Service Packages
Package 1: Three-Tier Documentation Refresh. Suitable for groups that already have prior-year BEPS documentation and need a year-end update. Includes refreshed FAR review, new benchmarking, Local File and Master File drafting, CbCR notification support, and Form 3CEB attestation review.
Frequently Asked Questions
Who needs to file BEPS Action 13 documentation in India? Any constituent entity of an international group is subject to BEPS Action 13 in India where the international group meets the consolidated revenue threshold. The thresholds for the Master File and Local File are lower than the CbCR threshold; we assess applicability at the first scoping call.
Can a group reuse last year’s documentation? Only as a starting point. The benchmarking study must be refreshed, the FAR analysis must be reconfirmed and the intercompany transactions must be reviewed for any new flows. Rolling forward unchanged is a common audit trigger.
What happens if the CbCR is inconsistent with the Master File? The competent authority that receives the CbCR through exchange will read it against the Master File. Inconsistencies are flagged for review and can prompt a transfer pricing audit. Building all three documents from a single FAR base prevents this.
Does Innobrant work with auditors and tax counsel? Yes. Many of our engagements run alongside the group’s statutory auditor and external tax counsel. We share workpapers, attend joint meetings, and align our documentation with the positions the wider team is taking.