The most common deductible expenses for the self-employed are operating consumption. These are made up of all the raw materials, fuels, containers, packaging and office supplies essential to carry out the work, which includes the purchase price and additional expenses until final reception, such as transport, customs, and insurance. In addition, the production cost of what is manufactured by the company itself is obtained by adding to the acquisition price the costs directly attributable to the product and the part that reasonably corresponds to the indirect costs of its manufacturing process.
You can also deduct the amortization expenses of the tangible or intangible assets themselves, that is, the amount of their deterioration.
Deductible expenses are also those related to salaries and wages of employees, as well as allowances, extraordinary payments and allowances for travel expenses. Social security expenses by the company and contributions to mutual societies of the owner of the activity, such as contributions to the special regime for self-employed workers (RETA) of the latter, are also deducted. Other personnel expenses are those derived from job training, severance pay for workers, their accident insurance, gifts to customers and staff, and contributions to pension plans or company social security plans.
Today there are many expenses resulting from the use of the home as a workplace. In these cases, the self-employed person can take advantage of the 30% reduction in domestic supplies, such as water, gas, electricity and telephony of the proportional part of the house destined for the activity, as long as he has received it. notified to the Treasury in its census declaration.
These deductions are added to those applied to leases and fees, including rents, fees, technical assistance and financial lease payments that do not relate to land or other non-depreciable assets. As well as the occurrence of repairs and conservation, such as maintenance expenses, spare parts and adaptation of material goods; excluding those derived from extensions or improvements because they are considered investments amortized over several years.
Examples of deductible expenses
In accordance with the Income Tax Law in Argentina, the deductibles are indicated below:
- Essential consumption linked to production, that is, raw materials and office supplies;
- Wages and salaries, training courses, compensation for termination of contracts and insurance;
- Payment of leases, rental of premises, leasing and renting;
- Repair and conservation expenses;
- Independent Professional Services: Lawyers and advisory services;
- Recreation and recreation expenses of employees;
- Amortization or depreciation of assets acquired to carry out economic activities;
- Expenses considered difficult to justify;
- Donations to non-profit institutions or charities;
- Other deductible expenses: subscriptions to professional magazines, professional associations;
- Funeral expenses.
Difference between deductions and credits
Deductible expenses are amounts used to be subtracted from the taxable income tax base, they are authorized by law and in some cases have a certain ceiling value.
The relief is essentially the elimination of a tax, that is, it is a figure that will not be included in the base for the calculation of the tax, but must be deducted from the income prior to calculating the amount that will be subject to tax.
Automated expense management
Companies strive every day to improve efficiency and effectiveness, maintaining good control over expenses is essential to guarantee economic profitability regardless of whether income is stable.
To carry out proper management, it is essential to create a consistent expense policy to anticipate unforeseen events or events such as fraud, duplicate receipts, accounting errors, timely orders and purchases of raw materials with suppliers, make payments on time and comply with the Tax obligations are the key to success in a company.
Technology has become the most important tool to carry out all these tasks smoothly, and in digital format for accounting management.
Thus, companies save time and money on paper costs. In seconds the documents are visible for review, processing and approval with the following benefits:
SAP Concur Expenses state-of-the-art solution
It is a work tool designed so that companies can systematically keep track of all expenses and classify them according to their nature to execute accounting and financial records in an orderly manner with the aim of issuing reports in real time.
In this sense, we can obtain the deductible expenses of the company immediately and consequently make the income tax return in an expedited time.