Deductibility of consumables

The High Court of Cassation and Justice decided that, in accordance with art. 21 para. (1) of Law no. 571/2003 regarding the Fiscal Code, for determining taxable profit, only expenditure incurred in order to achieve taxable income are treated as deductible expenses. Reported to the mentioned legal provisions, the High Court held that expenses representing consumables destined for carrying out repairs to the premises where the applicant operates, entertainment expenses, and costs of accounting supplies and typifications are deductible for income tax, as in the present case, analyzing supporting documents that were the basis for registration in the accounts of the company, it was found that these costs are based on invoices for goods purchased, containing the elements required by the accounting regulations (annex no. 2 to M.F.P. Order no. 3512/2008 on accounting and financial documents, completed by Order M.F.P. no. 2839/2010 in force at that time), and those expenditures were necessary for the work carried out by the applicant. (Decision no. 138 of 21 January 2015 given on appeal by the Administrative and Fiscal Department of The High Court of Cassation and Justice covering the annulment of tax decision).

Note: art. 25 para. (1) of Law no. 227/2005 regarding the Fiscal Code provides that “in determining the outcome, are considered tax deductible expenses the expenses incurred for business purposes”, the legislator renouncing to the “expenditures in order to achieve taxable income” wording present in the old Fiscal Code.

:: The Source: JURIDICE.ro

Anda-Laura TĂNASE

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