Poland: Amendment to CIT Act – transfer pricing modifications

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Poland: Amendment to CIT Act – transfer pricing modifications

Sponsored by

sponsored-firms-mddp.png
One of the key features of the Dutch corporate income tax regime is its fiscal unity regime

Revolutionary modifications in transfer pricing (TP) regulations, introduced by the Corporate Income Tax (CIT) law amendment valid since January 1 2017, may be followed by more changes binding from 2018.

Revolutionary modifications in transfer pricing (TP) regulations, introduced by the Corporate Income Tax (CIT) law amendment valid since January 1 2017, may be followed by more changes binding from 2018. A new draft CIT Law amendment was signed by the President on November 22 2017.

It introduces the below modifications.

No limit for expenditure on intangible services in the case of an APA

The amendment provides for the possibility of recognising all intangible and legal assets as tax-deductible costs if the taxpayer draws up an advanced pricing agreement (APA) with the chief of the National Tax Administration (NTA).

This rule can be applied during the term of the APA as well as both the tax year when the decision was made and the preceding year.

APA transactions exempt from TP documentation requirement

The legal amendments introduce another advantage for taxpayers who have APAs. An APA is already an effective method of mitigating tax risk and from January 1 2018 it also becomes exempt from the obligation for taxpayers in terms of preparing transfer pricing documentation. The exemption is available to taxpayers who receive a relevant decision from the chief of the NTA.

Arm's length nature of transactions in tax capital groups (TCG)

From January 1 2018, the provisions were repealed under which companies in TCGs were able to agree between themselves conditions of a transaction which might differ from the conditions available to unrelated entities. Therefore, effective January 1 2018, TCG entities must set the terms and conditions of transactions carried out with other TCG members at the market level.

Moreover, the amendment introduces an exemption from the obligation to prepare TP documentation for transactions between TCG entities. This obligation will now apply solely to transactions or other events between TCG entities with related parties outside the TCG.

Exemptions from documentation obligations for entities related solely through the state treasury or a local government unit

These TP provisions do not apply to entities that could be classified as related solely on the basis of a connection between them through the state treasury or a local governmental unit.

marciniak.jpg

Magdalena

Marciniak

Magdalena Marciniak (magdalena.marciniak@mddp.pl)

MDDP

Tel. +48 22 322 68 88

Website: www.mddp.pl

more across site & shared bottom lb ros

More from across our site

If the Reform leader becomes UK prime minister then he may follow the direction of the US in at least one significant way
Trump declared a new national emergency in issuing the order; in other news, Grant Thornton Germany is up for sale and the subject of interest from both its UK and US counterparts
The judgment, which saw Denmark's Supreme Court rely on OECD TP guidance, sets aside more than 15 years of consistent administrative practice, experts have told ITR
Belgium’s new coalition government has gone ahead with a new exit tax regime that could land it in the courts
Brazil’s government has not officially framed the bill as a countermeasure amid trade tensions with the US, but the move is being considered as part of Brazil’s strategic response, one expert tells ITR
Understanding India’s income tax landscape can help charities ensure compliance, optimise tax benefits, and enhance their impact, writes Raghav Bajaj of Khaitan & Co
Tax advisers in Brazil are rising above the country’s notoriously complex tax system to deliver high-quality advisory services, ITR’s exclusive in-house data reveals
ITR’s data has highlighted the US firm’s ambition to become America’s ‘premier’ tax player via a concerted partner recruitment strategy
Jaap Zwaan’s arrival continues a recent streak of A&M Tax investing in the region; in other news, the US and Japan struck a deal that significantly lowered tariff rates
In a world where international tax concepts rely on human activity, Leonard Wagenaar poses existential questions about the future of such ideas when AI is ever-present
Gift this article