Operations & compliance
Shared service centre pricing
Shared service centre pricing covers how a group prices the output of a centralised function, such as a regional finance or HR hub, when it charges other group entities for the services it delivers, typically using a cost-plus method with a mark-up benchmarked against independent service providers performing similar work.
Because shared service centres usually perform routine, low-risk support functions rather than bearing significant business risk, a modest cost-plus mark-up is normally appropriate, and tax authorities will scrutinise both the cost base included and whether genuinely non-recurring items have been stripped out first.
Setting up a shared service centre also raises location and substance questions, since tax authorities want to see that the centre has real people performing real functions in that jurisdiction, rather than being a thinly staffed cost pool used mainly to shift profit through an inflated recharge mechanism. This matters in.
In practice
What matters when applying shared service centre pricing
- Use cost-plus with a benchmarked mark-up
- Strip non-recurring costs from the cost base
- Ensure real substance in the SSC location
- Track service level agreements
- Review pricing when scope changes
Frequently asked
Common questions
What method is typical for shared service centres?+
Cost-plus is the standard method, with the mark-up benchmarked against comparable independent providers of similar routine support services. This matters in practice. Groups that get this wrong face avoidable risk.
Does substance matter for shared service centres?+
Yes, tax authorities expect the shared service centre to have genuine staff and functions in its location, not just a cost pool used to move profit between entities. This matters in practice.
See how the tooling handles this in practice
Our transfer pricing tools calculate intercompany charges, benchmark financing and reconcile the intercompany ledger from your own data. Book a short walkthrough and we will show the workflow on a scenario that matches your group structure, rather than a generic demo dataset.