The Finance Ministry has each year been adding disclosure duties on entities engaged in transactions with related parties. The next, fifth, version of the electronic TPR form should soon be published by the Ministry but, based on draft regulations concerning transfer pricing reports for PIT and CIT purposes, we already know what changes should be expected.

Under Article 11t of the CIT Act (and, correspondingly, Article 23zf of the PIT Act), companies required to issue transfer pricing documentation and companies exempt from that duty but engaged in certain controlled transactions must file a transfer pricing report (TPR) for each tax year until the end of eleventh month after the end of such tax year (this includes the tax year commencing after 31 December 2021).

In the newest release of form TPR, taxpayers will have to disclose:

  • a new financial indicator representing the ratio of operating costs incurred on activities with related parties to total operating costs of the reporting entity;
  • the particulars of counterparties based outside Poland; the previous duty that required the disclosure of only the home country is to be replaced with the duty to disclose the value of transaction per counterparty and the counterparty’s exact identification data including name and tax ID number.

Further changes include:

  • the new authority to which TPR is to be submitted (as of this year it will be the head of competent tax office);
  • an additional group of controlled transaction categories (reinvoicing),
  • adding a representation to the effect that the local file has been issued in accordance with the facts and the documented transfer prices are established on such terms as would be established between unrelated parties. Previously, this representation was a separate document.

If this issue pertains to your business and you are interested in our assistance, please contact us.

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