Poland Tightens Transfer Pricing Enforcement: Financing Under the Microscope

This blog was prepared by BTTP, Quantera Global’s Alliance Partner in Poland. It highlights Poland’s tougher transfer pricing enforcement and proposed changes, with a clear focus on intragroup financing and the risk of more audits and higher sanctions.

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Recent enforcement actions by the Polish National Revenue Administration (“KAS”) demonstrate a clear and accelerating shift toward more aggressive scrutiny of intra-group transactions — with a particular focus on intragroup financing. As highlighted (link here) in the recent KAS case related to non-market interest rates on related-party bonds, taxpayers face increasing exposure if their financial transactions are not supported by robust transfer pricing analysis and documentation.

This latest case, resulting in a correction exceeding PLN 11.5 million, is not an isolated incident but part of a broader, coordinated agenda of the Ministry of Finance (“MF”) to crack down on aggressive tax optimisation and profit shifting outside Poland (link here).

We would like to draw your attention to the planned changes announced by the Ministry of Finance in transfer pricing.

On 31 July, during the press briefing titled “Combating aggressive tax optimisation and the transfer of profits outside Poland” Minister Andrzej Domański and Deputy Minister Marcin Łoboda presented a new strategic direction for tax enforcement.

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Key pillars of the MF’s new approach:

1. Establishment of a Competence Centre for Aggressive Tax Planning (incl. transfer pricing)

Located in Kraków, the new Centre focuses on:

• advanced data-analytics-based selection of taxpayers for audit,
• intensive use of information from CIT returns, JPK_CIT (i.e. form of VAT reporting), and KSeF (i.e. National e-Invoice System, mandatory starting from 2026),
• specialised review of transfer pricing structures in multinational groups.

Additional personnel resources are being redeployed specifically to strengthen transfer pricing audits.

KAS has announced heightened interest in the following areas:

• intragroup financing (loans, bonds, cash-pooling),
• intellectual property management within multinational groups,
• centralised management structures,
• transactions involving business restructurings or capital-heavy flows within groups.

This aligns closely with the types of issues identified in the recent KAS audit involving non-market bond interest, strongly signalling that financial transactions are becoming a top-priority audit area.

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2. Legislative tightening expected by the end of 2025

A special MF task force was instructed to prepare proposals for significant amendments to transfer pricing legislation by the end of 2025. The results are expected either by the end of 2025 or to be implemented directly through the operational methodology of KAS (in which case formal legislative amendments may not be required).

The MF and KAS also intend to modify the methodology for transfer pricing audits, as well as the process for selecting entities for audit, leveraging the most advanced IT systems available.

Draft CIT/PIT Amendments Submitted to Parliament

On 11 August, a draft amendment to the CIT/PIT Act was submitted to the Parliament by the President of Poland (link available here). It contains several significant transfer pricing–related measures that could affect your organisation.

Key proposed changes include:

1. Public disclosure of transfer pricing information
   PGKs (i.e. tax capital groups, a special vehicles established in line with Polish tax regulations) and taxpayers with revenues exceeding EUR 50 million will be required to publish selected transfer pricing data.
2. Publication of aggregated TPR and TP audit information
   Transfer pricing disclosures and audit statistics will be made available in the BIP system (i.e. newsletter on public information).
3. Increase in the punitive tax rate (sanction rate)
   The draft proposes raising the sanction from 10% to 20% (under the Tax Ordinance) where a CIT decision results in additional tax liabilities due to underreported taxable income or overstated tax losses.
   This amendment is directly motivated by transfer pricing concerns.
4. Mandatory customs-tax audit every three years
   Large taxpayers with average annual revenues exceeding PLN 5 billion must undergo a transfer pricing audit at least once every three years.

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What This Means for Taxpayers and Advisers

Taken together, these developments reveal a clear direction:

→ Significant tightening of transfer pricing enforcement in Poland.

→ Increased audit frequency, especially for large groups.

→ Particular focus on intra-group financing, the area now presenting the highest risk.

First effects of this strategy are already visible in the publicised KAS cases (links provided earlier).

Implications for Intragroup Financing

For those involved in structuring or advising on corporate financing within groups, the message is clear:

The arm’s-length nature of financial transactions must be rigorously demonstrated, not assumed.

This includes:

• market-based interest benchmarking,
• careful analysis of the borrower’s creditworthiness and the lender’s risk profile,
• clear documentation of the economic purpose and use of funds,
• consistent treatment in CIT, WHT, TPR, and financial statements,
• consideration of substance and decision-making processes within the group.

Given the new MF/KAS agenda, weak or generic documentation, outdated benchmarking, or structures lacking economic justification may quickly become audit hotspots.

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Summary

There is a coordinated effort underway to strengthen both transfer pricing legislation and audit enforcement in Poland. KAS is prioritising:

• financial transactions,
• IP-related arrangements,
• centralised group models,
• high-value cross-border flows.

With new competence centres, enhanced analytics, mandatory audits for large taxpayers, and a potential doubling of sanction rates, the risk environment for transfer pricing, especially intragroup financing, is changing rapidly.

Need clarity on how these Polish TP changes affect your group? Contact us or BTTP to discuss your situation.

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