Poland: Safe harbor rate of interest, related-party loans in 2022

The base interest rate and margin for transfer pricing purposes for 2022 were announced in Poland.

Safe harbor rate of interest, related-party loans in 2022

The Ministry of Finance in late December 2021 announced the base interest rate and margin for transfer pricing purposes for 2022.

The interest rate “safe harbor” is applicable when there are loans (as well as certain credits and bonds) concluded between related parties.  

If the taxpayer meets certain conditions regarding the transaction, including setting the interest rate of the subject loan on the day of the agreement using the base interest rate and the margin as specified in the announcement (as of the date of the agreement), the tax authority will “waive” a determination of the taxpayer’s income (loss) when within the scope of the interest rate regarding the subject loan.

The safe harbor is available for income (revenue) from 1 January 2022.

The announcement specifies five types of base interest rates under five different currencies (that is, for loans denominated in Polish złoty (PLR), U.S. dollars, euros, Swiss francs, and British pounds) with notations of a “3M compound rate.”

Read a January 2022 report prepared by the KPMG member firm in Poland

 

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