Change of the calculation of the provision for bad debts, as those came into force by virtue of Law 4172/2013 (relevant article 26) as of the year 2014.
As of 01.01.2014 the following applies:
The provisions amounts for bad debts amortization and the write-off of those provisions amounts, are deductible for tax purposes, thus as per the following cases:
a) In cases of due receivables up to an amount of € 1.000,00, which have not been collected for a period of over 12 months, the tax payer can build a provision for bad debts to a percentage of 100% of the receivable concerned, provided that the necessary legal actions for the assurance of the right to collect the receivable concerned, are undertaken,
b) in cases of due receivables over the amount of € 1.000,00, which have not been collected for a period of over 12 months, the tax payer can build a provision for bad debts, provided that the necessary legal actions for the assurance of the right to collect the receivable concerned, are undertaken, according to the following table:
|
Time of delayed receivable collection (in months) |
Provisions (in % percentage) |
|
>12 |
50 |
|
>18 |
75 |
|
>24 |
100 |
It is not allowed to build provisions for bad debts in the cases of bad debt of the share holders or partners of the company of the subsidiaries with a minimum participation percentage of 10%, unless there is a pendency of proceedings before court concerning the claim for those debts or in case the debtor has submitted a claim for declaration of bankruptcy.
Moreover, it is not allowed to build provisions for bad debts which are covered by an assurance or any security or any further contractual or collateral security.
A receivable due amount can be written-off for tax purposes, provided that the following conditions are cumulatively met:
a) The amount corresponding to the debt has already been posted as revenue,
b) The receivable due amount has already been written-off from the tax payer's tax books, and
c) All legal actions for the collection of the receivable amount have been undertaken
NOTE: This article does not cover advisory, but only informational purposes, and cannot serve, as a basis for further actions, on the part of the reader. Reception of specialized advice is required.
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