An entity carrying out an investment project may reduce the taxable profits 100%. The taxable profits may be reduced during the tax period for which the calculated taxable profits are reduced by the amount of the actual costs incurred for the acquisition of the below assets. The taxable profits shall be reduced if the assets are necessary for the entity to carry out the investment project and:
- the assets are attributable to the following kinds of fixed assets: “plants and machinery”, “installations (structures, wells, etc.)”, “computer and communications equipment (computers, computer networks and hardware)”, “software”, “acquired rights”, trucks and trailers (up to EUR 300,000) and
- the assets have not been used and were produced not earlier than two years ago (as calculated from the date when such fixed assets were put into use).
Where the amount of costs exceeds 100% of the amount of taxable profits calculated for a tax period, the costs exceeding this amount may be carried forward to reduce the amounts of taxable profits calculated for the four subsequent tax periods, respectively reducing the amount of the costs carried forward.
The taxable profits may be reduced only by the costs incurred during the tax periods of 2009–2023.
Fixed assets for the acquisition of which the taxable profits have been reduced must be used in the activities of the entity for at least three years. Where such fixed assets are used in the activities of the entity for a shorter period, except when the entity ceases to exist and in cases when the assets are lost due to force majeure or criminal activity by third parties, the corporate income tax that has not been calculated due to the reduction of taxable profits must be paid to the State budget, recalculating and taxing the taxable profits of the previous tax periods.
An entity intending to reduce its taxable profits due to an investment project, upon having started to carry out the investment project, must inform thereof the local tax administrator in accordance with the procedure and within the time limits established by the central tax administrator.