Austria MOF Clarifies Deductibility of Guaranteed Payments as Business Expenses for Company’s Managing Director, Shareholder

The Austrian Federal Ministry of Finance Feb. 18 posted Federal Finance Court Decision No. RV/7100468/2018, clarifying the deductibility of guaranteed payments as business expenses for the managing director and shareholder of a company. The taxpayer, a managing director of a company, later became a 99.8 percent shareholder of that same company. The taxpayer claimed a guaranteed payment as a business expense after the company’s loan was enforced, arguing that it was assumed under political pressure rather than shareholder motive. The Tax Office contended that the guaranteed payment wasn’t deductible because it was shareholder-motivated and therefore a non-deductible capital contribution. On ...