Grzegorz Garbarczyk, InfoCredit
On August 25, the Sejm received a draft amendment to the act on corporate income tax (https://sejm.gov.pl/Sejm9.nsf/druk.xsp?nr=2544), assuming, inter alia, beneficial for taxpayers changes in the preparation of transfer pricing documentation for the so-called Heavenly transactions. The most interesting change for taxpayers is certainly the repeal of Art. 11o paragraph. 1a and 1b of this Act - as a result, there will be no obligation to prepare transfer pricing documentation for indirect transactions with tax havens. This obligation arose in a situation where the contractor of a given taxpayer (very often an unrelated entity) made transactions with an entity from a tax haven (literally reading the provision, transactions of even minimal value).
From the outset, these provisions were widely criticized - both by taxpayers and tax advisers - as an excessive (and often impossible in practice) administrative obligation. One of the arguments was that the regulations did not generate significant benefits for the State Treasury. In our opinion, there are other better tools to fight transfers to tax havens than transfer pricing documentation dedicated to transactions with related entities.
At the same time, another beneficial change was introduced for taxpayers, this time concluding direct transactions with entities from tax havens. Although the obligation to document these transactions remains, the thresholds from which they arise have been significantly raised - PLN 2,500,000 for financial transactions and PLN 500,000 for non-financial transactions. The current threshold was PLN 100,000, regardless of the type of transaction. This change will certainly result in a significant decrease in the administrative burden on taxpayers by reducing the number of transactions subject to the obligation to prepare transfer pricing documentation for direct paradise transactions.
To sum up - the current legislative proposals of the Ministry of Finance are most appropriate and beneficial for taxpayers. In a word: finally!