On 19 January 2022 The Director of the National Fiscal Information issued an individual interpretation (0111-KDIB1-2.4010.385.2021.1.AW) regarding the determination of the lack of the obligation to prepare transfer pricing documentation under Art. 11o of the Corporate Income Tax Act for purchase transactions in the case of a supplier’s statement that it is the actual owner of the receivables received.

According to Art. 11o (1a) of the Corporate Income Tax Act, taxpayers are required to prepare local transfer pricing documentation:

(a) making a controlled transaction or a transaction other than a controlled transaction, if the real owner has its place of residence, registered office or management on the territory or in the country applying harmful tax competition, and

  1. b) the value of that transaction for the tax year exceeds PLN 500,000.

The beneficial owner is an entity that:

(a) receives the receivable for its own benefit, including deciding independently on its use and bearing the economic risk of losing the receivable or part of it,

(b) is not an intermediary, representative, trustee or other entity that has a legal or constructive obligation to transfer all or part of the claim to another entity,

(c) has a genuine establishment in the country of establishment if the receivable is received in connection with a business activity, whereby in assessing whether the entity has a genuine establishment Article 24a(18) shall apply mutatis mutandis.

On the basis of the above definition, the actual owner can only be the entity receiving receivables.

In the opinion of the tax authority, verification in terms of the obligation arising under Art. 11o. 1a of the Corporate Income Tax Act is subject to purchase transactions, i.e. transactions in which the taxpayer purchases goods or services. The above means that, as a rule, transactions in which the taxpayer sells goods or provides a service to the other party to the transaction are not subject to verification on the grounds of Art. 11o.1a of the Corporate Income Tax Act, as they are connected with payment of amounts due to the taxpayer.

An exception to the above may be situations in which the recipient of the receivable is a Polish resident, if the actual owner is a tax haven entity.

To sum up, in the event that an entity sells services to an unrelated domestic counterparty and indicates that it is the actual owner of the receivables received as the entity rendering the services, no documentation obligation arises in this respect.


Author: Beata Rawa – Transfer Pricing Manager