In accordance with a draft of changes presented by the Ministry of Finance, transfer pricing regulations are to be modified again. Some of the changes are positive for taxpayers, as they simplify fulfilment of their obligations. Nevertheless, some additional sanctions are planned with a view to further sealing the tax system.
- A sttement on the local transfer pricing documentation and the arm’s length pricing will include an additional element: a statement that the local transfer pricing documentation has been drawn up in conformity with the actual circumstances.
- Recognition for tax purposes of the revenue from gratuitous performance will be sufficient for submission of a statement on the arm’s length pricing (it has been challenged so far).
- The aforesaid statement will be transferred to the TPR form (it will no longer be filed separately as it has been so far) which will not have to be filed by all management board members, but in accordance with the rules of representation (including, the holder of the general commercial power of attorney – prokurent), and also by an attorney-in-fact who is an attorney at law, legal counsel, tax advisor or a chartered accountant.
- Nevertheless:
- a new regulation in the Penal Fiscal Code will impose sanctions on anyone who contrary to the obligation fails to draw up the TP Local File, fails to attach thereto the TP Master File, or has drawn up any of such documentation contrary to the actual circumstances;
- the sanction will be a fine of up to 27 million zlotys (in 2021), i.e., the highest fine provided for in the Code;
- the sanction, therefore, will not be limited only to the management board members who sign the statement, but potentially it may also affect all persons involved in preparing the documentation (including the Master File) and in determining prices with affiliated companies, including, e.g., a chief accountant, financial director, etc.;
- Additionally, management board members who sign the TPR may be affected by the aforesaid sanction also in case they give in the TPR data inconsistent with the local transfer pricing documentation.
Other changes are as follows:
- it is intended to exempt from the documentation obligation:
- safe harbor loans (now: the exemption means the absence of the obligation to prepare the benchmarking study only);
- re-invoices (but only after a number of conditions have been met);
- transactions with or between foreign permanent establishments in Poland (if both parties have not suffered any tax loss and do not enjoy any exemptions);
- it is intended to exempt from the obligation to prepare the benchmarking study:
- transactions made by micro or small entrepreneurs;
- transactions made with unrelated tax haven parties, or when tax haven parties are ultimate beneficiaries;
- it will be possible to make the in minus TP adjustment on the basis of an accounting voucher that confirms making of the correction by the contracting party (now, a statement is required), and there will be no need to indicate in the CIT return the fact of making the TP adjustment;
- interest on the safe harbor loan will have to be updated pursuant to the MF announcement valid as at the date of each change in the loan agreement as regards interest;
- subject to extension are the deadlines for drawing up:
- TP Local File – till the end of the 10th month following the lapse of the tax year,
- the TPR form – till the end of the 11ven month after the lapse of the tax year;
- the deadline for submission of TP documentation upon demand of a tax authority is extended from 7 to 14 days;
- the entity filing the TPR form will be exempt from the obligation to submit ORD-U form, except for transactions with tax haven parties;
- the TPR form is filed by a partnership (and not by an appointed partner).
At present, the draft is at the stage of consultations and it has not been passed on to the Parliament yet. The changes are to come into force as from 2022.
