Polish governance: There will be simplifications in transfer pricing
Until 2 July, comments may be submitted on another package of tax changes to be introduced next year under the Polish Governance Programme. This time among the planned modifications are those concerning transfer pricing.
– According to the Ministry of Finance, the aim of the changes in the transfer pricing area is to simplify and de-bureaucratise existing regulations or procedures. These are the right assumptions, as entrepreneurs expect regulations that can be applied in practice without unnecessary formalities, says Cyprian Werykowski, tax adviser, director at Thedy & Partners.
Among the planned changes is elimination of the statement on preparation of transfer pricing documentation and market nature of applied transfer prices as a separate document and inclusion of the statement in the transfer pricing information (TPR).
– This means that the taxpayer will file one form – adds Cyprian Werykowski.
There is also to be introduced the possibility of waiving the preparation of a comparison/compliance analysis by entities for controlled transactions concluded by taxpayers who are micro/small businesses and for transactions other than controlled transactions concluded by taxpayers and companies not being legal persons with an entity from a tax haven.
– Certain deadlines will also be extended. For example, businesses will have 14 days to submit local documentation when requested by the tax authority. The deadline for preparing local transfer pricing documentation will also be extended. It will be prepared by the end of the tenth month after the end of the tax year. In turn, the deadline for filing transfer pricing information will be extended to the end of the eleventh month after the end of the entity’s fiscal year,” Cyprian Werykowski points out.
According to the MF, the new regulations will exempt taxpayers from the obligation to prepare local documentation with regard to safe harbour transactions concerning loans, credits and bonds. There is also to be an exemption from the documentation obligation for the so-called pure reinvoicing transactions. In addition, the scope of the transfer pricing analysis required for the local documentation of the contract of a company that is not a legal entity is to be clarified.