Presidential Draft Reform of Transfer Pricing Rules: Significant Changes for the Biggest Companies

A change of the head of state often signals a shift in economic and tax policy. Alongside widely discussed tax relief for families with at least two children, the draft of the new law introduces provisions that may significantly impact the transfer pricing control system — particularly for the largest companies operating in Poland.

Mandatory Regular Audits for the Largest Companies
The draft proposes that taxpayers with an average annual revenue exceeding PLN 5 billion over the last three years would be subject to mandatory transfer pricing audits at least once every three years.
In practice, this may lead to a quasi-automatic audit mechanism for the country’s largest business entities.

Broader Disclosure of TPR Data
The new regulations would expand the scope of information published by the tax administration. In addition to existing reports on the largest taxpayers, selected data from TPR forms could be made public, including information on:

• selected services,
• financial transactions,
• transfers of assets and intangible rights.

These types of transactions often trigger disputes with tax authorities due to the risk of challenging the arm’s length nature of the terms. As a result, the largest taxpayers may need to prepare for the disclosure of values of certain transactions reported in TPRs.

Annual Reports by Tax Authorities
The proposal also includes the annual publication of:

• aggregated statistical data from TPR forms,
• summaries of the number and outcomes of transfer pricing audits.

Greater transparency may lead to increased public and media interest in the transfer pricing policies of large companies.

Potential Expansion of Obligations

The current PLN 5 billion threshold targets primarily the largest entities, especially those within international capital groups. However, if the audit mechanism proves effective, there is a possibility that this threshold may be lowered in the future, encompassing a broader group of taxpayers.

Implications for Businesses – Transfer Pricing in the Foreground
Transfer pricing has long been a priority in tax audits, both in Poland and globally. The planned changes mean companies will need to place even greater emphasis on:

• meticulous and timely documentation of related-party transactions,
• regular updates of benchmarking studies,
• ongoing monitoring of compliance with transfer pricing regulations and tax authority practices.

Failure to maintain proper documentation—or providing false information—may result in severe financial penalties and fiscal criminal  liability for management board members.

Recommended Immediate Actions
Although the draft is still in its early legislative stages, it is advisable to:

• verify the current status and completeness of transfer pricing documentation,
• monitor revenue levels and types of transactions subject to documentation requirements,
• implement procedures to ensure quick access to data in case of audits,
• closely follow the legislative process.

How We Can Support You
We offer comprehensive support in the area of transfer pricing, including:

• analysis of related-party transactions and risk identification,
• preparation or update of transfer pricing documentation,
• preparation of benchmarking studies,
• development of procedures for improved communication with tax authorities,
• representation in audit and court proceedings.

Do not hesitate to get in touch with us – we can help your company prepare for potential changes and new obligations in the transfer pricing area.