In accordance with the transfer pricing rules, in the period from 1 January 2019 to 31 December 2020 there was no reference to the concept of ‘controlled transactions’. The documentation obligation concerned transactions whereby the entity pays the claim to the tax resident entity in the tax haven and to the non-legal persons, joint venture agreements and other similar contracts with such entity. The documentation obligation did not include non-legal companies. There was no “real owner” concept.
Transactions with tax havens, in accordance with transfer pricing rules, from 1 January 2021 Article 11i CIT Act / Article 23u PIT Act
Provisions Article 11c and Article 11d / Article 23o and Article 23p [i.e. the provisions concerning the conditions for the setting of transfer prices and the verification of transfer prices shall apply mutatis mutandis to a transaction other than a controlled transaction with an entity:
- 1) resident, established or managed in the territory or country applying harmful tax competition, or
- 2) other than resident, established or managed in the territory or country applying harmful tax competition if the beneficial owner is resident, established or managed in the territory or country applying harmful tax competition.
Transactions with tax havens in accordance with transfer pricing rules from 1 January 2021 Article 11k(2a) CIT Act / Article 23w(2a) PIT Act 2a.
In the case of controlled transactions with a resident, established or managed in the territory or in a country applying harmful tax competition, the document threshold shall be 100,000 PLN, regardless of the type of transaction.
Transactions with tax havens in accordance with transfer pricing rules from 1 January 2021 Article 11o(1) CIT Act / Article 23za(1) PIT Act 1.
Tax payers and companies other than legal persons carrying out transactions other than a controlled transaction with a resident, established or managed in a country applying harmful tax competition shall also be required to draw up local transfer pricing documentation if the value of the transaction for the tax year and in the case of non-legal persons for the financial year exceeds 100,000 PLN.
Provisions Article 11k(3-5) / Article 23w(3-5) [i.e. concerning the documentation thresholds and the obligation to draw up local tax documentation, Article 11l / Article 23x [i.e. concerning the determination of the value of the controlled transaction], Article 11q(1) / Article 23, section 1 [i.e.
concerning elements of local transfer pricing documentation] and Article 11r / Article 23zd i.e. concerning the update of the benchmarking and conformity analysis] shall be applied mutatis mutandis.
Transactions with tax havens in accordance with transfer pricing rules from 1 January 2021 Article 11o(1a-1b) CIT Act / Article 23za(1a-1b) PIT 1a.
Tax payers and non-legal persons carrying out a controlled transaction or a transaction other than a controlled transaction shall be obliged to draw up local transfer pricing documentation if the beneficial owner is resident, established or managed in a country applying harmful tax competition and the value of that transaction for the tax year, and in the case of non-legal companies for the financial year, exceeds 500,000 PLN.
…] 1b.
For purposes section 1a the actual owner is presumed to be resident, established or managed in the territory or country applying harmful tax competition, if second party to the transactions referred to in section 1a, shall settle in the tax year or financial year with the entity established or managed in the territory or country applying harmful tax competition.
In determining these circumstances, the taxable person lu
Transactions with tax havens in accordance with transfer pricing rules from 1 January 2021 Article 11q(1a) CIT Act / Article 23zc(1a) PIT 1a. For transactions referred to in Article 11o(1)(1a) / Article 23za(1)(1a), the local transfer pricing documentation shall also contain the economic justification for the transaction, in particular a description of the expected economic benefits, including tax benefits.