Success story

Justification of management fees invoiced and collected by the parent company from its subsidiaries

Context:

Multinational in the construction sector with subsidiaries all over the world needed to justify to the Public Administration of its subsidiary in Chile the management fees invoiced and collected.

How we helped:

  • Identifying the management fees of the parent company, as well as those affecting only the Chilean subsidiary.
  • Supporting the conceptual justification of which expenses and why they were invoiced to the Chilean subsidiary: service provided, need to be covered, etc.
  • Gathering of supporting documentation on the unity of criteria of the parent company when acting in the same way for all its subsidiaries, together with the demonstration of the expenses incurred in each of the departments to carry out the work in Chile.
  • Identification of weaknesses in the justification of management fees, search for improvement systems and their implementation.

Result:

Detailed and solid justification of the management fees invoiced by the parent company to its subsidiary in order to avoid the tax contingency declared by the Chilean Public Administration.