Contractual penalties may be treated as tax deductible costs


On 21 July 2011, the Regional Administrative Court in Warsaw (“Court”) issued a favourable judgment with respect to tax deductibility of costs of contractual penalties (ref. III SA/Wa 2735/10).

The Court stated that contractual penalty may be treated as a tax deductible cost for Corporate Income Tax (“CIT”) purposes, if the Company incurred it for the purpose of generating revenues or securing a source of revenues. 

More information in Tax & Legal Alert prepared by PwC to download HERE

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