New treatment of executive salaries
Posted: Thu Dec 26, 2024 4:49 am
As of January 2015, directors' remuneration for performing tasks other than those of their position will no longer be considered non-deductible . They will no longer be treated as donations or gifts as they were until now. Therefore, even if the bylaws state that the position of director is not deductible, it is possible for the director to perform a management function and receive a fee for it and deduct that amount from the Corporate Tax, provided that the rest of the established legal requirements are met. When the director is also a majority shareholder and receives a fee for services other than those of his position, it is necessary to be able to prove that the provision of services is real and different from that of director and that it is not a simple remuneration of capital (distribution of dividends).
Reduction of administrator withholdings from 42% to 35%
The reduction in denmark whatsapp mobile phone number list withholdings in the tax reform also affects the salary that the director receives for exercising his position or for being part of a board of directors, which goes from 42% to 35% . However, the rule establishes an exception: when the income comes from entities with a net turnover of less than 100,000 euros, the percentage of withholding and payment on account will be 19%. The percentages of withholding and payment on account will be reduced by half when it comes to income obtained in Ceuta or Melilla that have the right to the deduction in the quota.
In principle, this is good news, although it must be taken into account that it can be difficult to differentiate between the work of a director and that of an administrator . If we cannot do so, it could be understood that the management position is nothing more than a fictitious assumption to cover up a remuneration to the administrator that would not be deductible if it does not appear in the statutes.
Reduction of administrator withholdings from 42% to 35%
The reduction in denmark whatsapp mobile phone number list withholdings in the tax reform also affects the salary that the director receives for exercising his position or for being part of a board of directors, which goes from 42% to 35% . However, the rule establishes an exception: when the income comes from entities with a net turnover of less than 100,000 euros, the percentage of withholding and payment on account will be 19%. The percentages of withholding and payment on account will be reduced by half when it comes to income obtained in Ceuta or Melilla that have the right to the deduction in the quota.
In principle, this is good news, although it must be taken into account that it can be difficult to differentiate between the work of a director and that of an administrator . If we cannot do so, it could be understood that the management position is nothing more than a fictitious assumption to cover up a remuneration to the administrator that would not be deductible if it does not appear in the statutes.