KPMG's Tax News outline and highlight legislative changes and trends in the area of tax.
This issue summarizes the most important amendments to the Rulebook on the Application of the Corporate Income Tax Law.
More detailed rules in regards to accommodation and travel costs
The recent amendments to the Corporate Income Tax (CIT) Law stipulate that accommodation and travel costs for non-employed persons will be considered as recognized expenses for CIT purposes if the taxpayer can provide appropriate documentation evidencing that these expenses were made for business purposes.
In line with that, the new amendments to the Rulebook on the Application of the CIT Law (“the Rulebook”) set out in more detail what would be considered appropriate documentation. The amendments list items such as invoices for accommodation (bed or bed & breakfast), invoices for the transportation (air ticket or another document depending on the way of transportation which will evidence the costs incurred) as well as additional documents that will evidence the relationship between the persons, costs incurred and the time period when the work was carried out.
It is expected that similar amendments will be introduced in the Law on Personal Income Tax (PIT), which would lay out when such costs would attract a liability for PIT.
Reduction of the calculated CIT liability
The recent amendments to the CIT Law introduce certain tax reliefs in the form of reducing the annual CIT liability for donations made to sport federations, sport clubs, active athletes or the Macedonian Olympics Committee (MOC).
The latest amendments to the Rulebook further determine that in order to utilize the above relief, the costs for the respective donations are initially to be added back to the CIT base when determining the CIT base for the respective period.
Adding new fields to the CIT return
The above amendments to the CIT Law and the Rulebook have led to the addition of new fields in the CIT return.
Entry into force of the amendments to the Rulebook
The above amendments entered into force on 14 March 2017 and will be applicable for determining the corporate income tax in the CIT return for 2017.
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