On 2 April 2021, the Polish Ministry of Finance has published tax clarifications on transfer pricing regarding the adjustment of transfer prices within the meaning of Art. 11e of the CIT Act (Article 23q of the PIT Act), in relation to the provisions in force from January 1, 2019.
In terms of transfer pricing adjustments within the meaning of Art. 11e of the CIT Act (Article 23q of the PIT Act), the explanations published below cover such issues as:
- Adjustment of transfer prices in the context of the arm’s length principle,
- Transfer pricing adjustment within the meaning of Art. 11e of the CIT Act (Article 23q of the PIT Act) – KCT11e,
- There has been a change in material circumstances affecting the conditions set during the fiscal year or the actual costs or revenues obtained are known to be the basis for the calculation of the transfer price, and ensuring their compliance with the conditions that would be determined by unrelated entities requires transfer pricing adjustments
- The taxpayer must have a written statement from the associated (related) company that a corresponding transfer pricing adjustment has been made for the same amount;
- The related entity must have its place of residence, seat or management board in the territory of the Republic of Poland or in a country or territory with which the Republic of Poland has concluded a double taxation avoidance agreement
- The taxpayer must confirm that the transfer pricing adjustment has been made in the annual tax return for the tax year to which the adjustment relates.
- Taxpayers can make downward adjustments only after receiving a statement from the associated company confirming that it actually made a corresponding adjustment, so that double non-taxation can be prevented.
