Poland: Changes relating to transfer pricing in pending legislation

Poland: Changes relating to transfer pricing

A draft bill to amend various tax laws was submitted on 29 September 2020 to the lower house of the Polish parliament.


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The draft bill generally reflects proposals that were announced in September 2020—read TaxNewsFlashbut with certain amendments. The amendments include proposals that would concern the transfer pricing rules in Poland.

  • Under the transfer pricing-related amendments, application of the arm's length principle would be extended and in particular when the beneficial owner is located in a tax haven jurisdiction (defined as a country or territory employing harmful tax competition).
  • The obligation to prepared a Local file would be imposed on taxpayers and “companies without legal personality” for non-controlled transactions with entities having their place or residence, seat or place of management in a tax haven jurisdiction, provided that the transaction value for the tax year exceeds PLN 100,000 (approximately U.S. $26,000). This provision would apply for taxpayers and “companies without legal personality” for controlled and/or non-controlled transactions if the beneficial owner has its place or residence, seat or place of management in a country or territory employing harmful tax competition. For transactions involving tax haven jurisdictions, the Local file would need to include an economic justification for making the transaction, and a description of the expected economic and tax benefits.

The draft bill further introduces a range of temporary transfer pricing-related measures, all of which would be intended to alleviate the economic impact of the coronavirus (COVID-19) pandemic for certain taxpayers, including:

  • An exemption from the requirement to prepare transfer pricing documentation when there has been a 50% revenue reduction (when compared against the total revenue earned in the corresponding period of the previous tax year)
  • An exemption from the requirement for a declaration from a related entity stating that the entity made transfer price adjustments in the same amount for the tax year when the COVID-19 state of emergency was in force
  • Declarations for recordkeeping and maintaining the Local file

Read an October 2020 report [PDF 250 KB] prepared by the KPMG member firm in Poland

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