Transfer pricing: fewer formalities, but the obligations remain

In brief

• A PIT and CIT amendment, signed on 15 October, removes several transfer pricing formalities.
• The declaration on arm's-length documentation is dropped, and micro and small firms no longer report financial indicators.
• Experts stress that the underlying transfer pricing obligations remain in force.

Fewer formalities for taxpayers

The amendment to the PIT and CIT acts, signed by the President on 15 October, scraps the requirement for taxpayers to declare that local transfer pricing documentation was prepared on arm's-length terms (Ceny transferowe: Będzie mniej formalności, ale obowiązki zostają – Prawo.pl). The information on transfer prices will in future be signed by a proxy rather than by the taxpayer itself. Micro and small enterprises will also no longer have to report financial situation indicators in that information.

Substance of the rules unchanged

Tax advisers caution that the easing is limited to paperwork. The law reduces the number of formal steps but does not soften the underlying transfer pricing requirements, which continue to apply to related-party transactions (Ceny transferowe: Będzie mniej formalności, ale obowiązki zostają – prawo.pl (2)).

What it means for businesses

Companies that rely on the simplifications should still prepare documentation that supports their pricing between related entities, since the duty to price transactions at market levels has not changed. The amendment, dated 18 September, reflects a broader effort to reduce compliance burdens for smaller firms.