Representation expenses: choice between actual costs or flat rate
In 2011, the bar associations reached an agreement with the tax authorities (see the official circular on the Strada Lex website). This agreement allows certain expenses to be covered by a flat rate:
client gifts and entertainment (social events, similar professional obligations, including restaurant expenses)
office cleaning products
minor office expenses
various publications without an invoice
These expenses are 100% deductible with no supporting documents required! The flat-rate amount is calculated on your income across 3 brackets: 3% on the first ā¬34,500 of income, 2% on the second bracket, then 1% on the third bracket. Example: if your income is ā¬40,000 or ā¬70,000, your flat-rate allowance is ā¬1,145 or ā¬1,735 respectively. Above ā¬103,500 of income, the flat rate no longer applies.
Please note: if you apply this flat rate, you can no longer deduct the actual costs covered by it.
š” By applying the lawyer flat rate, you benefit from a significant simplification. The amount is limited, but its big advantage is that it is 100% deductible and requires no supporting documentation!