Transfer Pricing for Healthcare & Diagnostics
We provide transfer pricing consulting for hospital chains, diagnostics groups, healthcare networks, medical-technology businesses and related service entities operating in India and overseas.
Group healthcare models create recurring related-party charges
Healthcare group transfer pricing in India centres on management fees paid to a foreign promoter, backed by a documented benefit test, medical technology or accreditation royalty rates, and defensible cost-allocation keys for shared corporate services.
Transfer pricing for hospitals and healthcare in India can involve several recurring cross-border charges within the same group structure. A hospital chain may receive management support from an overseas promoter, licence medical technology or a recognised brand, and share procurement, finance, IT, HR or quality-assurance functions with related entities.
These payments often attract scrutiny because tax authorities may question whether the Indian entity actually received the service, whether a local team duplicated the same function or whether the payment represents a shareholder activity rather than an operating benefit. Strong evidence and a clear economic method are therefore essential.
Typical healthcare structure
An Indian hospital or diagnostics group pays a management fee to a foreign promoter, licences medical protocols, accreditation know-how or a group brand, and shares corporate services across hospitals, laboratories and support entities.
A focused transfer pricing benchmarking study should support the fee, method and allocation approach used for each transaction.
Where transfer pricing applies in healthcare
Healthcare groups commonly have controlled transactions involving management, technology, brands, referrals, training and centralised services.
Management Fees
Hospital management fee transfer pricing may cover strategic planning, governance, procurement support, finance oversight, quality systems, regulatory coordination or operating assistance provided by a foreign promoter or group entity.
Medical Technology Licensing
Medical technology royalty India arrangements may involve diagnostic protocols, software, equipment know-how, treatment systems, accreditation frameworks or specialist operating models licensed from an overseas related party.
Cross-Border Referral Fees
Healthcare groups may refer patients, specialist consultations, second-opinion cases or treatment programmes across jurisdictions. Pricing should reflect the services performed, commercial contribution and regulatory responsibilities of each entity.
Shared Corporate Services
Centralised procurement, HR, finance, legal, IT, cybersecurity and quality functions may be cross-charged across hospitals or diagnostic centres. The allocation method should reflect actual consumption and exclude duplicated or shareholder costs.
Brand Licensing
An Indian hospital or diagnostics business may pay for use of a group brand, trade name or reputation platform. The royalty should reflect the rights granted, local marketing obligations, territory and measurable commercial advantage.
Clinical Training Programmes
Cross-border training may cover medical procedures, equipment use, laboratory standards, patient safety, accreditation or management systems. Cost-sharing should reflect participant benefit, trainer time, materials and programme scope.
How healthcare transactions are benchmarked
Method selection depends on the transaction, reliable comparable data and the actual functions performed by the service provider and recipient.
CPM and TNMM
CPM or TNMM may be used for management, administrative, procurement, technology-support and shared-service arrangements where a reliable cost base and comparable mark-up or operating margin can be identified.
CUP Method
CUP may be considered for medical technology, accreditation, software, brand and protocol licences where reliable comparable licence agreements or third-party pricing data are available.
Benefit Test Analysis
The benefit test demonstrates what service was received, why the Indian entity needed it, how it improved or supported operations and why an independent business would have been willing to pay for it.
Cost Allocation Keys
Shared costs may be allocated using revenue, patient volumes, test counts, headcount, procurement value, system usage or another driver that reasonably reflects the benefit received by each entity.
Management fees supported by a genuine benefit test
We begin by identifying every service or intangible covered by the payment, the team responsible for providing it and the operational need of the Indian entity. This creates a clear link between the agreement, invoices, internal correspondence and actual conduct.
We then test the pricing using comparable management arrangements, service-provider margins or royalty data, depending on the transaction. For shared costs, we review the cost pool and design allocation keys that match how each hospital or diagnostics entity uses the service.
The final position is documented consistently across intercompany agreements, invoices, transfer pricing documentation and Form 3CEB so the commercial explanation remains clear during assessment.
Management Fee Benchmarking
Comparable agreement or service-margin analysis supported by detailed benefit-test evidence.
Technology Royalty Analysis
Medical technology, protocol, accreditation and brand licence pricing using reliable comparable data.
Shared Service Costing
Cost-pool review and allocation keys based on actual service usage and measurable operating benefit.
Structuring Advisory
Transfer-pricing-ready service, licensing and cost-sharing models for expanding hospital and diagnostics groups.
Our healthcare transfer pricing services
We support healthcare businesses with pricing analysis, annual compliance, supporting evidence and dispute prevention.
Benchmarking Study
Economic analysis of management fees, medical technology royalties, brand payments, referral arrangements and shared-service margins.
TP Documentation and Form 3CEB
Annual Local File preparation and accountant-report coordination for healthcare management, licensing, referral and service transactions.
Learn more about our transfer pricing documentation services .
Benefit Test Documentation
Service descriptions, invoices, emails, reports, meeting records, deliverables and cost schedules organised into an audit-ready evidence package.
Audit and Litigation Support
Technical submissions and representation support for management-fee, royalty, shared-service and deductibility disputes before tax and appellate authorities.
Healthcare transfer pricing questions
Paying management fees or licensing medical technology?
Get your benefit test, royalty rate and shared-service allocation reviewed by our transfer pricing team.
Related: Transfer Pricing Benchmarking · TP Documentation Services