On 11 August this year, the Sejm received a draft bill submitted by the President of the Republic of Poland as part of the ‘Zero PIT’ initiative for families with two or more children. In addition to the proposed personal income tax preferences, the draft also contains significant changes in the area of transfer pricing (TP) and tax audits.
More detailed TPR reporting
The draft provides for more detailed TPR forms than those submitted to date. We are therefore facing another change in the structure of the form. According to the draft, taxpayers will be required to separately disclose the value of individual categories of intra-group transactions, i.e.:
- service (purchase) transactions, excluding intangible services other than low value-added services, research and development, intermediary services, and real estate-related services;
- financial (purchase) transactions;
- transactions involving assets (including the purchase, rental, lease, or leasing of intangible assets);
- transactions related to the use of intangible assets.
The new requirements are intended to increase the clarity of data reported by taxpayers and enable more effective analysis by tax authorities. It should also be mentioned that the clarification of the TPR form concerns transactions that are of particular interest to tax authorities.
Mandatory TP audits for the largest taxpayers
Another significant change concerns the introduction of regular transfer pricing audits for the largest economic entities. According to the draft, taxpayers whose average revenues for the last three years exceed PLN 5,000,000,000 will be subject to mandatory customs and tax audits in the area of transfer pricing at least once every three years. The new obligation is intended to ensure systematic verification of TP policies in the largest capital groups operating in Poland.
Higher penalties under the Tax Ordinance
The presidential draft also provides for an increase in penalties for irregularities found as a result of transfer pricing audits (additional tax liability under the Tax Ordinance). According to the draft, the rate of additional tax liability is to increase from 10% to 20% in the case of understatement of tax liability or overstatement of losses. It should be remembered that this rate may be doubled or tripled, meaning that the maximum amount may reach 40% and 60%. This is a significant tightening of the penalty policy, aimed at increasing prevention and the effectiveness of tax enforcement.
Annual publication of transfer pricing data
According to the draft, the Minister of Finance will be required to publish, by September 30 each year, aggregated data from transfer pricing (TPR) information submitted by taxpayers. This data will include, among other things, the number of TPR forms submitted and information on the number and nature of transfer pricing audits conducted. The purpose of this change is to increase transparency and enable the assessment of the effectiveness of control measures in this area.
Justification for the changes
In their justification, the authors of the draft indicate that these changes are a response to calls for transparency in the tax system and for strengthening public oversight and citizen control over large capital groups. In particular, the planned changes are intended to prevent unjustified transfers of income from Polish entities to related foreign entities. The justification also indicates that one of the main objectives of the CIT changes is to disclose the value of dividends, interest, and intangible services transferred from Poland. Although the authors of the bill claim that this change does not introduce additional administrative or financial obligations on the part of taxpayers, it does involve more work in preparing transfer pricing documentation, which in practice will also translate into costs and time for taxpayers associated with its preparation.
Summary
The draft law introducing PIT preferences for large families is also linked to an expansion of the state’s fiscal tools in the area of transfer pricing and tax audits, thereby increasing the burden on CIT taxpayers. These changes are part of a broader trend of tightening supervision over intra-group settlements and efforts to increase budget revenues through better monitoring of the largest taxpayers. If adopted in its current form, the amendment will enter into force at the beginning of 2026.