I made a transfer pricing error — do I lose my free zone exemption?

Not automatically. Related-party transactions must generally be priced at arm's length, but if a pricing error surfaces and is corrected through an appropriate adjustment in the tax return, it does not necessarily disqualify your Qualifying Free Zone Person status.

The real problem arises when the error is ignored and left uncorrected, or forms part of a recurring pattern suggesting avoidance. At RASEEKH, we review your transfer pricing file periodically so any deviation is corrected before it accumulates.