Beginning from 2015, there is a new opportunity for reducing the amount of the payable corporate tax. The arrangement is extremely favourable, involves very low (administrative) expenses, and is risk-free for the donor. Donations are very simple to make, involve minimal administration, and can help you achieve a tax credit.
Who can be the beneficiaries?
The new system makes it possible for companies to make sponsorship donations in the amount up to 80% of their corporate tax for certain types of beneficiaries.
Sponsorship is possible in support of the following three areas:
- cinematographic works;
- organizations of performing artists;
- popular team sports.
Why to sponsor?
In addition to the aspects related to corporate social responsibility, providing sponsorship offers a number of advantages for companies. Let us see some examples.
- No expenses! There are no expenses involved in connection with the sponsorship, as the tax authority transfers the amount of the donation at the request of the selected organisation from the corporate tax already paid. This means no additional costs incurred by the company other than the corporate tax that would be paid in any case.
- No risks! If, for any reason, the company fails to satisfy a condition, the tax authority would simply not transfer the amount offered to the organisation selected. Since the corporate tax has already been paid, no tax arrears would arise in such a case.
- Minimal administration! Sponsorship is provided by way of completing a form, with the rest of the administration done between the beneficiary and the Tax Authority.
- No cash-flow disadvantage! The company does not transfer the donation to the beneficiary, only pays the corporate tax as required. The tax credit is added to the tax account of the company, and as such, it can be used for reducing later corporate tax liabilities.
- Tax savings of up to 7.5% In case of donations from the tax advance or tax advance supplement, up to 7.5% of the amount donated can be achieved as savings (in other cases, the tax credit is 2.5%).
How can Mazars help you?
The experts of Mazars can assist you throughout the entire process with the following:
- We are happy to help you chose the organisation to be sponsored.
- We provide help with the related administration, the conclusion of the contracts, the preparation and filing of the necessary documents (including, in case of popular team sports, the contract on the supplementary support, as well as in case of all forms of sponsorship, the preparation and checking of the request for the sponsorship certificate, which is to be submitted jointly with the sponsored organisation, the sending of the sponsorship certificate, the preparation of the statement of instruction, etc.).
- We can determine the maximum amount that can be offered, as well as the optimal scheduling to achieve the biggest possible tax advantage.
- We maintain contact with the partner on a continuous basis, thereby freeing you from all related obligations.
In case you should you have any questions in connection with the above, we would be pleased to be at your service.