Additional Tax Liability in Transfer Pricing

The article examines the additional tax liability imposed under Article 58a 1 point 4 of the Tax Ordinance. The analysis covers the legal nature of this sanction, its separateness from the tax liability itself, the conditions and mechanism of its assessment, the significance of transfer pricing documentation, and the compatibility of the adopted solutions with the principle of proportionality. The author demonstrates that transfer pricing remains the only taxpayer-specific basis for assessment in respect of which relief from the sanction on grounds of good faith has been excluded. At the same time, the sanction applies automatically once an income adjustment is made, while transfer pricing documentation generally protects the taxpayer only against an increased rate. Using gross amounts as the assessment basis may result in a sanction exceeding the underlying tax burden or arising even where no tax liability exists. An assessment of this framework against national and EU regulations supports introducing a mitigation mechanism that would account for the seriousness of the infringement, the taxpayer’s diligence, and the actual loss of public revenue.