The amendment to the Act on Income Tax effective from January 1, 2017 extends the definition of the term rent. Inter alia, the condition of payment as defined in § 17 Sec. 19 b) applies not only to the lease of movable and immovable property, but also to the payment for granting the right to use or for the use of:
- the subject of industrial property
- software
- designs and models
- plans
- production and technical-related and other economically utilizable knowledge (know-how)
- the payment for granting the right to use or for the use of copyright or related rights.
Keep in mind:
- This change shall be applied already for the submission of tax return after December 31, 2016, which means, it is also applicable for the tax return of the taxable period 2016.
- The Financial Administration notes that equivalent to the assessment of revenue from lease for the lessor, it is also necessary to assess expenditures related to the lease for the lessee. This means that if payments are agreed in the lease contract separately for the lease and for the services related to the lease including utilities and the lessee pays such payments to the lessor, then all these payments are considered to be revenues from the lease to the lessor. All these expenditures are considered to be a part of the tax base for the lessee only after their payment, despite the lessee would record them on other cost accounts.
