Since 1 January 2019, all taxpayers obliged to prepare transfer pricing documentation have also been required to prepare dedicated transfer pricing analyses. In principle, benchmark analyses are valid for 3 years from their preparation. Therefore, a vast majority of benchmark analyses that were prepared by taxpayers for the first time for 2017 or 2018 are becoming no longer valid this year and need to be renewed while their correctness needs to be verified.

The purpose of a transfer pricing analysis is to substantiate the arm’s length nature of related-party transactions. Therefore, the substantive and formal correctness of the analysis is crucial to protect the taxpayer from the negative consequences of having the arm’s length nature of the transaction questioned by the tax authorities.

A high-quality transfer pricing analysis makes it possible to:

  • Obtain information if the transaction terms and conditions of transactions already applied or just being planned are set at the arm’s length.
  • Develop a basis for executing and subsequently submitting a statement on preparation of transfer pricing documentation. If an incorrect or unreliable analysis is prepared, taxpayers must take into account the risk of penalties exceeding PLN 26 million resulting from submitting an incorrect statement!
  • Be secure in case of a possible tax audit. A transfer pricing analysis is verified by the authorities during a tax audit. If the transfer pricing analysis has been prepared in a reliable manner, the risk of the tax authorities making an tax adjustment is limited.

What should you pay attention to in a transfer pricing analysis

Transfer pricing analyses may be prepared in various forms, depending on the type of transaction under review and the availability of comparable data. Regardless of the type of analysis, though, special attention should be paid to:

  • proper identification of the functional profile of the transaction parties
  • appropriate selection of comparable entities (including not only a database search results, but also actual verification of activity on the websites of individual entities)
  • elidable documentation of the analysis conducted and assumptions made (very important in case of tax audits which may be conducted even in 6 years after conducting of transaction)
  • exclusion of related entities from the analysis
  • recommended preparation of the analysis based on specialized external databases also used by tax authorities during tax audits.


In order to have a new benchmark analysis prepared or to have the validity and correctness of a benchmark analysis verified, please contact:

Magdalena Marciniak +48 22 322 68 88

or your advisor at MDDP.


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