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It is sometimes the case that even inconspicuous transactions between related entities cause problems during a tax audit. Business restructuring – especially if it involves transferring economically significant assets, functions or risks – must be done in compliance with transfer pricing regulations if it concerns related entities. With the support of RSM Poland's tax advisors, who will verify whether the actions you have undertaken are in compliance with applicable law and prepare necessary documentation, you will be well-prepared and avoid potential penalties.
Why choose RSM Poland when restructuring related entities?
Our comprehensive tax advisory services, addressed both to Polish and multinational groups and entities, make it possible to go through the planned restructuring process in an effective and legal manner. RSM Poland's team will identify potential transfer pricing tax risks and adopt a strategy which will defend your decisions in the event of a tax audit. As part of an analysis of business restructuring:
- We make disputes with tax authorities less likely – we check if reallocation of functions, assets and risks meets the restructuring criteria in accordance with transfer pricing regulations, and, if necessary, set out business reasons for the restructuring (together with preparing relevant documentation) and represent taxpayers during tax audits.
- We make necessary calculations – we carry out a detailed valuation to verify whether the restructuring takes place on an arm's length basis.
- We assess the amount of the so-called exit fee – we verify whether the so-called exit fee is due and assess its value to ensure compliance with all legal requirements and help to avoid any tax risks.
Analysis of restructuring processes: step by step
1. Analysis of the planned restructuring in respect of transfer pricing regulations
As the first step, RSM Poland's tax advisory team carefully analyses the planned transactions and economic events, assessing their impact on the operations of the participating entities and identifying potential tax risks.
2. Analysis of the compensation for the restructuring and the so-called exit fee
The next step involves analysis of the planned compensation based on the arm's length principle and determining if the so-called exit fee is due and evaluating its amount.
3. Preparation of necessary documentation
As the final part of our support, we prepare the so-called defence file, which confirms that the restructuring has business reasons and brings the expected benefits, helping to prevent disputes with the tax authorities.
Frequently asked questions: what should you know about restructuring processes?
The so-called exit fee is a compensation payment which an entity from a group may be obliged to make to another entity for discontinuance of activities, lost benefits, or transfer of functions, risks or assets.
The exit fee may apply in the case of:
- discontinuance or take-over of part of the business,
- transfer of contracts with customers,
- provision of production and sales capabilities,
- transfer of profit potential.
The reasons for business restructuring are primarily included in appropriate transfer pricing documentation. The documentation is comprised, among other things, of the following:
- a list of the economic grounds for the restructuring,
- an analysis of the profitability of other solutions,
- a list of the expected business benefits.
RSM gives you confidence that all your planned activities will comply with the law
Make sure that there is no place for errors in such important processes as company reorganisation. Let RSM Poland's tax advisors take care of the compliance of your planned operations with tax regulations and help you to minimise costs and tax risks. When restructuring entities operating in Poland, choose effective and tested solutions offered by qualified experts on transfer pricing!
