The issue of including benefits for self-employed individuals as tax-deductible costs is of vital interest to many entrepreneurs. Companies often choose this form of cooperation to attract specialists, for example in the IT industry. Can the costs of benefits for B2B contractors be included in tax-deductible expenses? There is a tax authority interpretation.
B2B Cooperation – Benefits for Self-Employed Individuals as Tax-Deductible Costs
The issue of including benefits for self-employed individuals as tax-deductible costs is of vital interest to many entrepreneurs, as companies often choose this form of cooperation to attract specialists. This is particularly the case in the IT industry.
A company from the IT industry asked the tax authority in a recently issued interpretation (No. 0114-KDIP2-1.4010.558.2024.1.PK dated December 2, 2024), whether it can include expenses for benefits for IT specialists with whom it cooperates as tax-deductible costs.
The company provides contractors with, for example:
– memberships to sports facilities,
– medical packages,
– or life insurance.
The interpretation was favorable for the applicant – the IT company. It confirmed the possibility of including expenses for benefits for B2B contractors in the company’s tax-deductible costs. What determined this interpretation? The provisions in the cooperation agreement.
Life Insurance for an IT Contractor on B2B as Tax-Deductible Cost?
The position contained in the issued interpretation depends on:
- demonstrating the impact of such cost on increasing the company’s income;
- and the provisions in the cooperation agreements concluded with the benefit recipients.
The tax authority agreed with the company that such benefits make it easier to acquire and retain specialists. Benefits have a motivating effect on them, which increases the quality of services provided, and consequently increases the company’s income.
Benefits Guaranteed in the B2B Cooperation Agreement as Tax-Deductible Costs
What should also be particularly emphasized is the fact that benefits are guaranteed as a component of remuneration in the cooperation agreement. This argument was crucial for the Director of the National Tax Information to recognize that expenses for providing these benefits may constitute tax-deductible costs. This is worth remembering when drafting and signing a B2B agreement.
The above interpretation is likely a light at the end of the tunnel and a pleasant surprise, as in most cases the tax authority does not approach such benefits very favorably.
Author: Małgorzata Zielińska, tax advisor No. 13177
For questions and issues regarding tax law, please contact: podatki.zielinska@gmail.com.
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