MF will clarify the homogeneous nature of the controlled transaction

– The general interpretation will cover the definitions contained in Article 23w, sections 2-5 of the PIT Act and Article 11k, sections 2-5 of the CIT Act. The Ministry wants to clarify in its document how to understand the notion of homogeneity of a controlled transaction. As the MF points out, the homogeneous nature of a transaction should be understood as similarity of the subject of the transaction and other main parameters of the transaction, significant from the point of view of transfer pricing. A controlled transaction of a homogenous nature will also be a set of controlled transactions, which, for the purposes of determining the value of a controlled transaction, should be aggregated, due to their homogenous nature. As the Ministry specifies, the concept of homogeneity of transactions is similar to the understanding of the concepts of “transactions of one type” and “other events of one type” that were in force in the Acts on PIT and CIT before 1 January 2019, so the “homogeneity” of transactions should be seen as a development and clarification of the concepts before 1 January 2019. The cited provisions indicate the elements to be taken into account when assessing the homogeneity of a transaction, notes Cyprian Werykowski, tax adviser, director at Thedy & Partners.

It is also worth emphasising that in order to clarify the notion of homogeneity, the tax acts also indicate the elements on the basis of which the homogeneous nature of a transaction should not be determined.

– The MF’s general interpretation in this area is important. The correct determination of the scope of transactions of a homogenous nature is crucial from the perspective of determining the taxpayer’s documentation obligations – adds Cyprian Werykowski.