Transfer pricing

This is the first stage, which makes it possible to separate genuine obligations from areas that do not require excessive effort. In practice, companies often know that they "have transfer pricing," but do not always know which transactions are material, where documentation obligations arise, and which settlements may attract the attention of the authorities. I help organize this picture and identify where real risk actually arises: in the margin level, the method of remuneration calculation, the absence of a benchmarking analysis, incomplete documentation, or inconsistency between the agreement, the books, and the actual conduct of the transaction. This allows the company to make decisions based on a concrete map of obligations rather than on a general sense of risk.

Such a review is particularly important when the documentation was prepared several years ago, transactions within the group have changed, the company uses centrally prepared documents, or there is uncertainty as to whether the local documentation properly reflects Polish tax realities. The purpose of the audit is not to multiply objections. It is about providing a practical answer: what is correct, what requires supplementation, where risk arises, and which elements are worth improving before an audit. A well-conducted review helps avoid a situation where the documentation formally exists but fails to defend the company's settlements when the authority starts asking specific questions.

Good TP documentation should not merely be a collection of information required by statute. It should explain why the group's settlements are at arm's length and what function they serve in the business. That is why, when working on documentation, it is important not only to fulfill the obligation, but also to ensure consistency between the transaction description, the agreement, the books, the group policy, and the actual conduct of the parties. I support companies in preparing documentation that is clear, logical, and defensible in the event of an audit. This is particularly important for service, financial, licensing, and manufacturing transactions, as well as for settlements that affect the taxable result of the Polish company.

A benchmarking analysis is one of the key elements in defending the arm's length nature of a transaction. It is not just about generating a report from a database. What matters is the proper identification of the transaction, the selection of the method, comparability criteria, the benchmarking sample, and the interpretation of results in the context of the specific business model. I also support the assessment of whether safe harbor simplifications can be applied, in particular for loans and low value-adding services. I help verify whether the company meets the conditions for the simplification and whether its application is actually beneficial. A safe harbor can reduce obligations and risk, but only when used consciously and in accordance with the statutory conditions.

In practice, the problem often lies not in the mere absence of documentation, but in the fact that the settlement model is not well described or does not correspond to how the transaction actually operates. A contract manufacturer, a limited-risk distributor, a shared services center, and an entity holding intangible assets must each be assessed differently. My task is to translate the business model into the language of transfer pricing. I help determine who performs key functions, who bears significant risks, who uses the assets, and what level of remuneration is justified. This allows the company not only to prepare documentation, but also to organize the actual settlement mechanism within the group.

A transfer pricing policy should answer practical questions: how we calculate remuneration for services, what markup we apply, how we account for financing, how we set intra-group sales prices, what we do when there are deviations from the assumed profitability level, and who is responsible for monitoring. A well-prepared policy is not a document created solely for audit purposes. It is a tool for managing group settlements. It helps maintain consistency between agreements, documentation, invoices, books, and the actual conduct of transactions. In practice, it reduces the risk of adjustments, disputes with the authorities, and internal misunderstandings between group companies.

A transfer pricing audit rarely limits itself to checking whether documentation has been prepared. The authorities analyze whether the description of the transaction corresponds to reality, whether the method was selected correctly, whether the benchmarking analysis is credible, and whether the result of the Polish company is justified by its functions, assets, and risks. In such cases, calm and consistent communication with the authority is essential. I help clients not only to answer questions, but also to build a complete picture of the transaction, so that the company's position is clear, documented, and defensible at subsequent stages of the proceedings.

Transfer pricing disputes rarely concern a single straightforward provision. They typically focus on facts: who performed key functions, who bore the risks, whether a given company should have achieved a certain profitability level, whether the benchmarking analysis was correct, and whether the adjustment is justified by the actual conduct of the transaction. I help clients navigate this process from a tax, evidentiary, and strategic perspective. Depending on the situation, this may mean preparing explanations, defending the existing model, analyzing adjustment options, supporting negotiations with the authority, or representing the client in further dispute proceedings.

The MAP procedure may be appropriate when actions taken by the authorities of one state lead to taxation inconsistent with a double tax treaty — for example, as a result of an income assessment in a transaction with a related party. An APA, on the other hand, allows for agreement with the authority on the transfer pricing method for future transactions and increases the predictability of settlements. In such matters, thorough preparation of the strategy, argumentation, and economic documentation is essential. I help assess whether a given procedure makes sense in a specific situation, what its benefits and limitations are, and how to guide the company through a process that requires the combination of law, economics, taxation, and business practice.