Corporate - Deductions

Last reviewed - 03 December 2023

Taxable income is determined after deducting all expenditure and costs incurred in the realisation of the gross income (for more details on the deemed profit basis of assessment on branches of foreign companies, see the Branch income section).

For any entity (not a foreign branch) seeking to be assessed on an add-back basis, it should ensure, in accordance with Stamp Duty Law, that the majority of its costs can be supported by tax-registered documents (i.e. declared payrolls and registered contracts and invoices).


Depreciation should be calculated in accordance with the Executive Regulations of the law.

Assets Depreciation rate (%)
Building in which machines are fixed 4
Building without fixed machines 2
Moveable buildings 10
Means of transport:  
Passenger 20
Cargo and freight:  
Less than 3 tons 15
Over 3 tons 10
Ships 5
Fishing boats 5
Aeroplanes 8
Office, ship, and domestic furniture 15
Hotel, restaurant, cafes, and hospital furniture 20
Work camps outside of cities 20
Food utensils and furnishings for restaurants, hotels, and the like 25
Office machines 15
Electric generators 20
Computers and accessories 25
Software 50
Other machines 15


Purchased goodwill can be amortised on a straight-line basis over five years.

Organisation and start-up expenditure

Organisational and start-up expenditure can be capitalised and amortised over five years on a straight-line basis.

Interest expenses

No specific rules apply for the deduction of interest expenses.

Bad debt

Bad debts are only recognised to the extent that they have been recognised as such legally.

Charitable contributions

Donations to charities recognised by the state are permitted at up to 2% of net income.

Fines and penalties

No specific rules apply for the deduction of fines and penalties.


No specific rules apply for the deduction of taxes.

Net operating losses

Losses may be carried forward and deducted from future profits, for up to five years. The Income Tax Law has no provision for the carryback of losses.

Payments to foreign affiliates

No specific rules apply for the deduction of payments to foreign affiliates.