Rental costs while the legal entity is suspended

Rental costs while the legal entity is suspended

 

Question:
Hello!

The company ceased operations in August. It has rented a room to carry out its activities - a coffee shop. The landlord / legal entity / issues rental invoices for each month of the year, even when it is not working. Can invoices that are for the months after the cessation of activity be recognized as an expense of the company and how is this expense treated for tax purposes?

Thanks in advance!

 

Answer:

Hello,

Given that the company has ceased operations, there is no way to recognize the cost of renting a commercial property. If it was a question of any administrative costs (office rent, mobile services, etc.), then their reporting could be postponed for a future period in which the company will start operating again. In this case, however, given that the activity is most likely the operation of the said coffee shop, there is no way to recognize rental cost for a period in which the company has not carried out any activity.

We hope we have been helpful to you.

Greetings!