Abstract

In the present article the authors describe conditions which must be met by an expense in order to be considered as a tax deductible expense in the light of article 15 (1), taking into account that this provision is not a clause of circumventing tax law. As long as activities done by a taxpayer were valid and eff ective, and the expense resulting from these activities is connected with taxpayer’s business, this expense will be a tax deductible expense (on condition of lack of special exemptions). Th erefore, license fees in virtue of rights to use trademarks of which assets were transferred to a related entity beforehand, constitute a tax deductible expense, regardless of taxpayer’s motivation to make the proper transfer.