Changes ahead for thin capitalization rules

The current thin capitalisation rules limit the tax deductibility of interest on loans and borrowings from related parties. The new rule will regulate the rules of tax deductibility the so-called exceeding interest costs, i.e., interest costs in excess of interest income, irrespective whether they originate from related parties.

Slovakia must transpose Article 4 of the Directive ATAD 1, which defines the Interest Limitation Rule until 2024 at the latest. We will monitor the development of the legislative process and keep you updated.

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