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Modern transfer pricing reporting procedure (TP-R)


by Aleksandra Galczak,

25 March 2019


The obligation to report transfer prices in electronic form (TP-R) came into force on 1 January 2019. Based on the amended provisions of the (Polish) Corporate Income Tax Act and the Personal Income Tax Act, it has replaced the existing obligation of filing CIT/TP and PIT/TP reports. The Regulation of the Minister of Finance of 21 December 2018 on corporate income tax on transactions covered by transfer pricing rules is the implementing regulation in this respect.

Documentation obligation and thresholds

At present, both associated enterprises entering into transactions requiring the preparation of a local file and associated enterprises concluding domestic transactions exempt from the obligation to prepare documentation (pursuant to Article 11n(1) of the CIT Act of 15 February 1992) are obliged to report information on transfer pricing in the form of the new electronic TP-R form. Entities exempt from the obligation to prepare transfer pricing documentation for domestic transactions will be required to prepare TP-R only if a domestic transaction exceeds the following documentation thresholds laid down in the act:


  • PLN 10 million for the sale/purchase of merchandise, tangible assets, obtaining/granting debt financing, sureties or guarantees;
  • PLN 2 million for the sale/purchase of services, intangible assets, rental, lease, licences and other transactions.

Transfer pricing report – structure

Transfer pricing report – structureThe transfer pricing report (TP-R) is divided into six sections and should include:


  1. the purpose of filing the report on transfer prices, i.e. indicating whether the report is submitted for the first time or is being amended as well as indicating the period for which the report is submitted;
  2. identification details of the entity filing the report on transfer pricing and the entity for which the report is being filed;
  3. general financial information of the entity for which the report is being filed, including the values of financial indicators being a measure of the entity's financial situation (value of the operating margin, gross profit margin, return on assets, return on equity)
  4. information about associated enterprises and controlled transactions specifying the categories of controlled transactions plus their values – the taxpayer will be able to select the same category several times, e.g. if the loans were received for a different purpose or on different terms (codes were assigned to each category of controlled transactions, which are presented in the Appendix to the respective Regulation of the Minister of Finance);
  5. information about methods and transfer prices covering among others:
  • methods selected to verify the transfer price;
  • information on the rate of return selected to verify the transfer price;
  • information on transfer pricing analysis (verification method, party selected for examination, criteria applied for the selection of comparable data, comparability adjustments made);
  • information on the result of the benchmarking study;

6. additional information or explanations about associated enterprises and controlled transactions concluded with those entities as well as information on transfer pricing and methods, including information on transfer pricing adjustments made and explanations of selected categories of controlled transactions (pursuant to Article 11t(2) of the CIT Act and the Regulation of the Minister of Finance referred to above.

Domestic entities carrying out domestic transactions for which no transfer pricing documentation must be prepared are not required to provide general financial information, information on transfer pricing and methods and additional explanations (referred to in Article 11t(2)(3), (5) and (6) of the CIT Act).

The justification to the act indicates that the new method of filing reports should be simpler and more user-friendly for taxpayers, while the electronic form itself is supposed to make it easier for them to submit a report on transfer pricing.

In addition, it is emphasized that TP-R is aimed at simplifying and tightening of the transfer pricing regulations. The new reporting method should also improve the quality of information available to tax authorities during taxpayers' audits. According to the justification to the act, this procedure aims at streamlining the identification of potential risk areas of understating income in terms of transfer pricing through non-arm's length behaviour. In addition, the information collected in the form of e-reports (TP-R) should help statistical and economic analysis, in particular with regard to the drafting of transfer pricing regulations. The Minister of Finance now has on-demand access to the information on prices via an ICT system.

Although the legislator emphasises that electronic transfer pricing information is much less complicated as it is closely connected with the method of presenting information in the transfer pricing documentation, our close analysis of the mandatory information to be disclosed in TP-R shows that a TP-R actually reveals greater amount of information than was the case in the previous CIT/TP and PIT/TP reports. Additionally, in some cases the scope of information to be submitted has been significantly increased (which is unfavourable for taxpayers as it requires greater workload and disclosure of more detailed data) as compared to the information presented in the transfer pricing documentation (e.g. detailed listing of transactions concluded with associated enterprises, or a synthetic and systematic presentation of the results of the benchmarking study carried out for each transaction). Moreover, the reporting is much more accurate, since the taxpayer is now required to indicate the method selected to verify the arm’s length nature of the prices and to provide information on the results of transfer pricing analysis in the form. Therefore, taxpayers will face an increased workload and a number of new administrative duties. 

For the tax authorities, the undoubted advantage of the new reporting procedure will be the availability of detailed data allowing them in-depth scrutiny of entities conducting transactions with associated enterprises.

Stricter sanctions

Since 1 January 2019, the penalty for the failure to file an electronic TP-R form has become more stringent. Failure to submit transfer pricing information on time or making untrue representations therein is subject to a fine of up to 720 day-fine units (Article 80e of the [Polish] Code of Criminal Procedure).


In the case of partnerships which do not have a legal personality the information on transfer prices must be delivered by a designated partner (Article 11t(5) of the CIT Act). Appointment of such a partner does not release other partners from the liability for the failure to file the transfer pricing information.

Deadline for filing TP-R

Due to the fact that the reported information is derived to a large extent from the local transfer pricing documentation, the legislator has set the same deadline for preparing the transfer pricing information and for preparing the local file, i.e. by the end of the ninth month after the end of the fiscal year. Taxpayers will have to submit transfer pricing information (TP-R) for the first time in 2019 by the end of September 2020.

Since the fulfilment of the above obligations may prove to be extremely time-consuming and at the same time sanctions for the failure to submit transfer pricing information on time have been tightened, we recommend that you make relevant preparations to fulfil these requirements in advance, especially with regard to a detailed audit of your transfer pricing methods and the benchmarking study.


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Dominika Tyczka-Szyda

Tax adviser (Poland)


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