New obligation to file CIT/TP report in Poland

3 November 2017

We would like to remind you of the new obligation to file a summary report (CIT/TP) for the tax year commencing after 31 December 2016, which should be attached to the annual tax return.

The obligation applies to entities whose revenues or expenses (in the meaning of the Accounting Act) exceed the equivalent of EUR 10 million in the tax year. The amount in EUR needs to be converted into PLN at the average exchange rate announced by the National Bank of Poland as of the last working day of the tax year preceding the tax year for which the report is filed.

For taxpayers whose tax year corresponds to the calendar year the above 2017 threshold amount in EUR is PLN 44,240,000.00.

In the context of this new reporting obligation we recommend monitoring your revenues and expenses and taking relevant measures to ensure effective exchange of information to be able to fill out the abovementioned report.

As the questions included in the report are about strategic matters, the report should be filled out in liaison with the decision-making entities and persons in the group, as well as with the accounting departments and your advisers on transfer pricing. Information provided in the report should also be consistent with the data and information included in the transfer pricing documentation.

Among other things, the following information has to be disclosed in the form:

• type(s) of relationships (e.g. capital, management, family links);
• permanent establishment(s);
• core business activity taking into consideration transfer pricing regulations;
• restructuring processes (e.g. a change of structure or legal form, merger, demerger, takeover/acquisition, including takeover of an organised part of the enterprise), changes in the functional analysis (i.e. in functions, assets, risks in transactions with associated enterprises) and about compensation received/paid in this regard;
• cost contribution agreements leading to the production of intangible assets along with their values (and the determination of the taxpayer's contribution/revenue triggered by it);
• values of individual transactions made with associated enterprises, tax havens, and their percentage share in the revenues;
• transactions (e.g. on services and goods) effected free of charge.

Please, be informed that in order to fill out the form in a timely and correct manner, the company should start acting now.