Individual interpretation with 12 May 2021 Notes that the rent of an apartment in the city outside the centre of personal and economic interests of the entrepreneur, if necessary for the provision of services in a given place, can be eligible for revenue costs. They fulfil the condition that personal expenditure is not available.
The taxpayer operating with the PKD code requested interpretation 68.32.Z Real estate management performed on a contract basis. On 1 July 2020 The applicant signed a contract for maintenance of commercial real estate (officer, shopping centre) with Sp. z o.o. based in W, hereinafter referred to as the Customer.
Supported by the Property Applicant are located in W. In accordance with the provisions of the contract concluded with the Customer, the activities carried out by the Applicant should be carried out directly at the location of the property. This fact compels the Applicant to have to stay in W.
for the purpose of fulfilling professional obligations and, consequently, to bear the cost of accommodation.
As indicated above, the operation of the property takes place in W., where the applicant provides services on weekdays, i.e. Monday to Friday. Sometimes it is also necessary to have the Applicant for random reasons on Saturday and/or Sunday.
This occurs as a result of random events such as occasional accidents, as well as outside the hours of commercial operation of investment facilities, which the applicant is obliged to supervise. In the absence of such additional obligations, the applicant shall normally return to its registered office, i.e.
G., whose address, as indicated above, is also the place of residence of the Applicant and of his wife. However, there may be situations where, given the distance between W. and G., i.e. the distance of about (...) km, and thus the time dimension of the journey, the Applicant decides to stay for the weekend in W.
Due to the distance between W.
and the headquarters of the Applicant and the time taken to travel daily, the absence of a guarantee of punctuality, thus disrupting the organisation of working time, as well as the cost of transport using foreign means of transport such as train, bus or plane or own car, The applicant decided that the only reasonable and economically justified solution would be to use accommodation services.
In this context, the applicant considered the purchase of accommodation services in hotels or the rental of a dwelling located in W. As a result of the analysis, the applicant considered that staying in a hotel was a solution similar to an economically unreasonable one as a daily journey on the W route. - G.
The nature of the activities which the applicant performs under the contract also requires high availability on weekend days. In addition to the high cost of hotel days, there is also a risk of lack of hotel accommodation in cases where the applicant would not make a reservation in good time, which, in the event of random events, and thus unpredictable, poses additional difficulties. Consequently, the applicant decided to rent a dwelling.
The lease agreement was concluded in writing for an indefinite period. This is due to the fact that the same period applies to the contract concluded with the Contractor.
Consequently, this allowed the Applicant to eliminate the risk of lack of accommodation in the event of random occurrences, while minimising the level of expenditure incurred, as rental costs, i.e. rent and media, are significantly lower than hotel services.
All indicated expenses shall be paid by the Applicant by bank transfer to the account of the owner of the premises indicated in the contract.
As indicated above, the costs of renting the premises are closely linked to the activities carried out by the Applicant in the course of the business activity. The expenditure would not have occurred if no contract had been concluded requiring the Applicant to arrive at W. in order to carry out the tasks assigned to him.
At the same time, at this stage, the applicant does not plan to change the address of its permanent residence or to change the address of its business activity as there is no guarantee that the contract has been renewed. Should the agreement be terminated, the applicant would return to G. where his life and economic interests centre is located.
The following question was therefore asked.
Are the costs of renting a residential accommodation in W., i.e. at the place of performance of the services resulting from the contract concluded by the Applicant, incurred for the purpose of accommodation?
The NSA considered that these costs could be considered appropriate for obtaining revenue. They fulfil all the conditions to consider the expenditure incurred by the taxpayer as a cost of obtaining revenue, namely:
The rental expenditure was incurred by the taxpayer, i.e. in the final analysis it is covered by the taxpayer's assets (they do not constitute the cost of obtaining the taxpayer's income, the expenditure which was incurred on the taxpayer's business by persons other than the taxpayer),
are definitive (actual), i.e. the value of the expenditure incurred has not been reimbursed to the taxpayer in any way,
are in connection with the economic activity of the taxpayer,
have been incurred in order to obtain, retain or hedge revenue or may affect the amount of revenue achieved,
have been properly documented,
are not included in the expenditure group which according to Article 23(1) The abovementioned Act is not considered as revenue costs, and it should also be pointed out that the fact that the public expenditure not constituting revenue costs is not included in the statutory list of expenditure Article 23 The Personal Income Tax Act is not sufficient for the tax qualification of the cost.
The absence of such an expense in the negative costs catalogue does not result in an automatic acceptance that it constitutes a tax cost. Doubts in this respect should be directed to an individual interpretation.
Individual interpretation with 12 May 2021, The signature. 0112-KDIL2-2.4011.315.2021.1.MW