Can I Claim Professional Fees (Accountants, Solicitors) as a Business Expense in Ireland?
Yes, fees paid to accountants, solicitors, tax advisors and other professionals for the trade are deductible against Corporation Tax. Capital legal fees (e.g. share issue) are not deductible.
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What Revenue (Revenue Commissioners) says
Professional fees incurred wholly and exclusively for the purposes of the trade are allowable. Fees relating to capital matters (raising share capital, acquiring a business) are capital and not deductible against trading profit. Fees are tested against the same rule as every other trading expense: the cost must be incurred wholly and exclusively for the trade and must be revenue in nature. Legal fees to defend or enforce a trading contract are usually allowable. Legal fees to acquire a lease or an asset are normally added to the asset cost.
When you can claim
- Accountant fees for bookkeeping, payroll, tax compliance
- Solicitor fees for trading contracts and disputes
- Tax advisor fees for VAT and CT advice
- Auditor fees (for medium/large companies that lose audit exemption)
- Fees for the CRO annual return and company secretarial work
- Debt collection fees and legal fees to recover a trade debt
When you cannot claim
- Legal fees for share issues or company formation (capital)
- Fees for personal tax returns of the director (unless director gives the company a benefit-in-kind)
- Fees relating to acquiring a fixed asset (capitalised instead)
- Fines, penalties and interest charged by Revenue, which are not wholly and exclusively for the trade
- The VAT on professional fees if the company is not VAT registered or the service is for an exempt activity
Good to know
Pro tip: Ask the adviser to split each invoice between compliance work and capital items such as a share issue or an acquisition. The split is what Revenue checks, and an unsplit invoice may be disallowed in full.
Important: Fees for the CT1 and the company's bookkeeping are an ordinary trading expense. Fees for negotiating a share issue or buying a business are capital, so keep those invoices apart. The fee for filing the annual return at the CRO is also a business cost.
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