Interest rate on loans between related parties for year 2024
In the Official Gazette No 157/2023 the Ministry of Finance published the 2024 annual market interest rate on loans between related parties which amounts to 3.25%.
This interest rate is the lowest, that is, the highest tax-deductible interest rate that can be charged on loans between domestic and foreign related parties:
- If interest on loans provided to foreign related party is not charged or is charged at the lower interest rate than prescribed, corporate profit tax base must be increased for the interest at the prescribed rate or the difference between the interest at the prescribed rate and the charged interest rate.
- For the excessive loan interest rate charged by foreign related party, corporate profit tax base must be increased for the difference between the charged interest and the interest at the prescribed rate.
This interest rate also applies on loans between domestic related parties if one of the parties is in a tax favourable position, that is, if one of the parties:
- pays corporate profit tax at the rate which is lower than the prescribed corporate profit tax rate or does not pay tax at all (i.e., uses tax relieves); or
- utilises tax losses carried forward from previous period in the respective tax period.
Penalty interest for the period from 1st January to 30th June 2024
Penalty interest for late payment of taxes and social security contributions charged by the Tax Authorities for the period from 1st January to 30th June 2024 amounts to 7.50% p.a.