Every expense goes through the same filter: do you need it for your activity? do you have a full invoice in your name with your NIF? is it entered in your expense ledger? If you use something both for the business and privately, the deduction gets harder and in many cases only part of it, or none, is accepted.
In an audit the burden of proof is on you: without an invoice in your name and a clear link to the activity, the tax agency can reject the expense. kontora records your expenses and prepares draft tax forms with deadline reminders; filing is always reviewed and signed off by you or your advisor.
The typical mistake is deducting with a simple till receipt, or deducting personal costs such as everyday clothing, meals without work travel or the family car. Another slip is confusing deductible for income tax with deductible for VAT: an expense can reduce your net income and still not let you deduct its VAT. Assets that last several years, such as a computer, are not deducted all at once but through depreciation.
It is linked to net business income, to the quarterly advance payments, to the annual income tax return and to input VAT on the quarterly VAT return. Everything ends up in the expense ledger, which is the basis for those forms.
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