Some entities will not prepare local documentation
The Ministry of Finance has decided to expand the list of exemptions from the obligation to prepare local transfer pricing documentation. Changes in this respect have been included in the Polish Deal.
The amendment to the tax regulations within the framework of the Polish Deal has already been approved by the government and is in the Parliament (print no. 1532). At the final straight, the MF introduced changes to the draft amendment. Some of them covered transfer pricing.
– According to the MF’s latest proposal, transactions between related parties located in Poland and foreign permanent establishments, whose parent company is a related party, as well as transactions between a non-resident related party located in Poland and a related party with tax residency in Poland will be exempt from preparing local transfer pricing documentation. Condition? Revenues and costs from the controlled transaction must be tax-settled in Poland, explains Cyprian Werykowski, tax advisor and director at Thedy & Partners.
Local documentation will also not be needed when entrepreneurs have a tax or investment agreement in place. Similarly, the exemption from preparing local documentation will apply to controlled transactions covered by the safe harbour mechanism for loans, credits, bonds and transactions concerning settlements within the scope of the so-called pure reinvoicing.