Tax & Legal

The Supreme Tax Court has held the annual cost of a pension promise to a former owner/manager who retired before the pension date to be a hidden distribution.

The Supreme Tax Court has handed down four judgments on pension promises to managing directors who are also majority shareholders specifying rules for distinguishing allowable business expenses from disallowable “hidden distributions”.

The finance ministry has issued a decree calling for a probationary period of 2-3 years before promising a pension to a director who is also a shareholder.