Corporate - Deductions

Last reviewed - 01 June 2022

Depreciation and amortisation

The depreciation rates are determined according to tax administration instructions and common usage, for example:

  • The depreciation rate for office items is 10% or 20%.
  • The depreciation rate for industrial buildings is 5%.
  • The depreciation rate for cars is 20% or 25%. The depreciation base for cars is limited to DZD 3 million.

Accelerated depreciation rates, when justified, can be used, depending on the activity sector and the economic use of the assets.

Low-value fixed assets

Starting from 2022, low-value fixed assets are deductible up to DZD 60,000.


Under the SCF, goodwill is registered in the local books as a non-current/intangible asset of the balance sheet and cannot be amortised. Consequently, the accounting of goodwill has no fiscal impact for companies.

Start-up expenses

Start-up expenses are deductible when paid and cannot be capitalised and depreciated.

Interest expenses

Interest expenses are deductible when paid.

Bad debt

A bad debt provision becomes deductible when legal action has been taken to recover the debt or when evidence is provided that the receivable has become irrecoverable.

Charitable contributions and subsidies

Granted subsidies and contributions for charitable organisations are deductible for CIT calculation purposes up to DZD 4 million/fiscal year.

Advertising gifts 

Advertising gifts are deductible up to DZD 1,000 /unit, up to the limit of DZD 500,000. 

Pension expenses

Pension expenses are deductible when paid.

Payments to directors

Payments to directors are deductible.

Research and development (R&D) expenses

R&D expenses are fully deductible when paid by the entity bearing the expenses and when justified. Revenues derived from R&D activities are exempted from CIT, up to a limit of 10% of the taxable benefit or DZD 100 million. The exempted amount has to be reinvested in R&D activities.

Bribes, kickbacks, and illegal payments

Bribes, kickbacks, and illegal payments are non-deductible from the CIT basis.

Legal fines and penalties

Legal fines and penalties are non-deductible from the CIT basis.

Contractual penalties

Penalties paid as part of contractual provisions are deductible for CIT calculation purposes, provided that the beneficiary of penalties is a taxable entity in Algeria.


Taxes duly paid are deductible, except for the CIT itself, which is not deductible. Also non-deductible for CIT purposes are the tax on apprenticeship and training and tax on passenger cars.

Net operating losses

Carryforward losses are permitted until the fourth fiscal year following the year of loss. Carryback losses are not permitted.

Payments to foreign affiliates

Payments to foreign affiliates are deductible.