The Slovak parliament approved a draft bill on 23 August 2024 for consideration that proposes amendments to the Income Tax Act. The amendments address the rules for tax-deductible provisions concerning bad debts.
As per the proposed amendments, deductions for bad debt provisions on receivables are age-based:
- 20% for over 360 days;
- 50% for over 720 days; and,
- 100% for over 1,080 days overdue.
The draft bill also proposes changes to tax deductions for bad debt provisions, allowing: 50% for receivables overdue beyond 360 days and 100% for those overdue beyond 720 days.
The proposed amendments enable taxpayers to quickly write off bad debt as tax deductibles rather than setting aside a provision for it.
For a draft bill to become law, it must be approved by parliament, signed by the President, and published in the official Collection of Laws.
The proposed changes are set to take effect on 1 January 2025.
