Year-end in transfer pricing – obligations, risks and key actions for 2025/2026

Why year-end is a critical moment in transfer pricing 

Year-end represents a convergence of three critical areas in transfer pricing: obligations for the prior year, review of current-year transactions, and planning for the years ahead. By December 2025, companies need to finalise obligations for 2024, ensure proper settlements for 2025, and prepare for the challenges that 2026 may bring. What steps should be taken to minimise tax risk and secure a smooth start to the new year? Below we outline practical guidance for closing the year in transfer pricing and preparing for future periods. 

FY2024: closing transfer pricing documentation and formal obligations 

Before focusing on the 2025 year-end and planning for 2026, it is essential to ensure that all obligations for 2024 have been fulfilled. For taxpayers whose fiscal year aligns with the calendar year, key deadlines for 2024 were as follows: 

• • Local Transfer Pricing Documentation (Local File) – by the end of the 10th month following the fiscal year-end, generally by 31 October 2025. 

• • TPR Form for 2024 – by the end of the 11th month following the fiscal year-end; for 2025, the statutory deadline was 1 December 2025. 

Most taxpayers will have already addressed these obligations, but some elements may still require attention: 

• • Master File – the deadline for preparation is the end of the 12th month following the fiscal year-end. Further information on the Master File can be found in our article [link: https://www.mddp.pl/master-file-what-it-is-who-is-required-to-prepare-it/  ]  

• • CbC-R Report – this report provides consolidated group-level data across jurisdictions, in contrast to the TPR form, which focuses on local transactions. It is generally due within 12 months of the group’s year-end; for 2024, the deadline is 31 December 2025. 

FY2025: closing the current year from a transfer pricing perspective 

For 2025, the TPR form submission deadline falls at the end of November 2026 (assuming a calendar-year fiscal period). As such, all market-comparability analyses undertaken now will later be reflected in this report. 

Transfer pricing should not be approached solely as a “compliance” exercise limited to documentation and forms. Formal obligations are merely a reflection of how actual intra-group commercial arrangements are structured. 

From a 2025 year-end perspective, the focus should be not only on completing documentation but also on ensuring that the group’s transfer pricing model reflects arm’s length principles. Key considerations include: 

• • The arm’s length nature of remuneration in individual transactions. 

• • Ensuring that each entity is appropriately compensated for the functions performed, risks assumed, and assets employed across the value chain. 

This distinction explains the difference between local documentation (specific to a particular entity) and group-level transfer pricing documentation (Master File – covering the entire group). However, both are secondary to the first principle: the transfer pricing model itself should be carefully designed, and documentation should reflect that model. 

Key areas to review for 2025 year-end 

Year-end is the final opportunity to adjust transactions and align them with market conditions. It is also the time to organise elements that will be reflected in the TPR form and transfer pricing documentation: 

• • Functional Profiles – are they still accurate? Have there been changes in operational, decision-making, or financial roles that affect the entity’s functions? 

• • Comparability Analyses and Other TP analyses – are they up-to-date (coverage period, industry changes, one-off events)? Are they robust enough to support remuneration levels in the event of a tax audit? It is advisable to verify whether 2025 margins fall within arm’s length ranges; if not, year-end adjustments may be required. 

• • Year-End Adjustments – which transactions require annual adjustments according to the transfer pricing model? Are these adjustments consistent with TP policies, agreements, and documentation? Are accounting and tax treatments in line with current guidance and case law? 

• • Benefit Offsets – do any transactions involve indirect or mutually compensating benefits that should be considered in assessing arm’s length pricing? 

The priority for 2025 should be ensuring the arm’s length nature of transactions (including potential year-end adjustments) and that documentation is in order, so that 2026 can focus on model changes and new obligations rather than catching up on unfinished work. 

FY2026: preparing your business for future transfer pricing challenges 

December 2025 is also the right moment to look beyond the “here and now” and consider how evolving regulatory and business environments will impact transfer pricing in the coming years. This approach protects both corporate tax positions and the personal responsibility of management, particularly board members. 

Key areas to monitor include: 

 1. Updating the transfer pricing model and policy 

Evaluate whether the current intra-group model reflects actual business reality and risk profiles. Consider: 

• • Supply chain changes (nearshoring, reshoring, new logistics centres) affecting functions and risks. 

• • ESG initiatives (green investments, new reporting standards) affecting cost allocation. 

• • Whether the current TP policy remains a practical reflection of intra-group practices rather than a purely formal document. 

If any answer is “yes,” December 2025 and early 2026 are suitable for revising the TP policy and adjusting the model. 

 2. Managing transfer pricing risk and stability of arrangements 

Consider using available tools to reduce the risk of disputes with tax authorities, including: 

• • Advance Pricing Agreements (APAs) – providing certainty regarding method and remuneration in specific controlled transactions. 

• • Cooperation Programmes – offering enhanced predictability and dialogue for large taxpayers. 

The focus should be on not only securing specific transactions but also managing the group’s overall TP risk portfolio. 

 3. TP risk audit – identifying high-risk transactions 

Conduct a review of transactions that: 

• • Are of significant value. 

• • Are of particular interest to tax authorities (e.g., financial transactions, intra-group services, and intangible asset (IA) settlements). 

• • Represent new arrangements emerging in 2025 (e.g., new functions in shared service centres, new licences, group financing changes). 

The objective is to answer a straightforward question: do we have robust arguments and data demonstrating the arm’s-length nature of each key transaction? If not, this must be factored into the 2026 action plan. 

 4. Tax procedures and board responsibility 

In many companies, TP is still treated primarily as a finance or tax department task. Yet: 

• • Board members are responsible for signing the TPR form and for statements regarding arm’s length pricing. 

• • Absence of proper procedures (e.g., for data flow, verification of new transactions, model updates) increases personal risk for directors. 

December 2025 is the time to: 

• • verify whether data flows between departments (finance, accounting, controlling, sales) enable the timely identification of controlled transactions and changes to the transfer pricing model, 

• • confirm whether the company has a formal transfer pricing procedure (or a broader tax procedure encompassing transfer pricing), 

• • assess whether the transfer pricing procedure is actually being followed in practice, 

• • supplement internal documentation (memos, opinions, decisions) evidencing that the management board has acted with due care. 

 5. TP and other tax or regulatory areas 

TP analyses are increasingly used beyond TP documentation, including: 

• • WHT rulings. 

• • Tax Capital Groups. 

• • Estonian CIT and IP Box preferences. 

• • Special economic zones and Polish Investment Zone activities. 

• • GloBE compliance and ESG-related cost/benefit allocation. 

TP analysis should therefore be viewed as a business tool, not merely a compliance document. 

 6. Staying updated – FCT, case law, and practices 

Transfer pricing is evolving rapidly, both in law and practice. For instance: 

• • The Transfer Pricing Forum (FCT) regularly issues recommendations, including in relation to financial transactions and binding instructions. In 2025, it adopted, among others, recommendations on binding instructions under the Polish Commercial Companies Code, which are particularly relevant for groups with extensive shareholder oversight structures. 

• • A new edition of the Ministry of Finance’s TPR form Guide has been released, clarifying technical and substantive issues related to reporting. 

• • Administrative court decisions provide an increasingly rich source of insight; tracking trends is highly valuable [link: https://www.mddp.pl/transfer-pricing-in-case-law-a-review-of-trends-in-2024/ ] 

In 2025, there is a notable increase in scrutiny of financial transactions, intangible services, and intangible assets (IA), underlining the practical importance of keeping up-to-date. 

Conclusion 

Year-end transfer pricing management requires a threefold perspective: 

• • Backward-looking – to close 2024 obligations (Master File, CbC-R, and verification of Local File and TPR form completeness). 

• • Current year – to ensure arm’s length pricing in 2025 transactions and organise documentation for the 2025 as well as prepare the financial data needed for the TPR form. 

• • Forward-looking – to establish models, procedures, and tools that allow for a smooth 2026 transition. 

Transfer pricing connects tax and business perspectives while bridging local regulations and global standards. It is unsurprising that it remains a focal point for tax authorities. Companies prioritising certainty and predictability in TP benefit from advisory experience that combines regulatory insight, administrative practice, and business reality.