France Administrative Court of Appeal of Paris Clarifies Deductibility of Litigation Expenses From Business Profits

The French Administrative Court of Appeal of Paris April 30 issued Decision No. 24PA03030, clarifying the deductibility of litigation expenses from business profits. The taxpayer, a property trader, was assessed additional income tax and social security contributions following a tax audit covering 2015 and 2016, after the tax authorities disallowed a charge recorded as litigation expenses. On appeal, the Administrative Court of Appeal of Paris found that: 1) the expenses must be incurred in the direct interest of the business or be related to the normal management of the business, as well as be supported by sufficient justification for claiming ...