2025 Corporate Income Tax campaign: non-accounting adjustments to review before filing Form 200

The Corporate Income Tax filing campaign is entering its final stage. Although the accounting profit is the starting point for calculating the taxable base, tax regulations require companies to make certain adjustments that may modify the amount ultimately subject to taxation.

The so-called non-accounting adjustments are among the issues that most frequently cause problems when filing Form 200. In many cases, errors do not arise from particularly complex transactions, but from differences between accounting and tax criteria that go unnoticed during the year-end closing process.

What are non-accounting adjustments and why are they necessary?

The Corporate Income Tax taxable base does not necessarily coincide with the company’s accounting profit.

The Corporate Income Tax Law establishes that the calculation starts from the profit obtained in accordance with accounting regulations, but requires it to be adjusted when the tax treatment of certain income or expenses differs from their accounting treatment.

These corrections are known as non-accounting adjustments and may increase or reduce the taxable base.

A common example is fines and penalties. From an accounting perspective, they must be recorded as an expense, but they are not tax-deductible. Therefore, when preparing the Corporate Income Tax return, a positive adjustment must be made to increase the accounting profit.

Ultimately, non-accounting adjustments make it possible to convert the accounting profit into the taxable base in accordance with the criteria established by tax regulations.

Permanent and temporary differences: an important distinction

Not all adjustments have the same effect. In practice, it is important to distinguish between permanent differences and temporary differences.

Permanent differences	Temporary differences
They do not disappear over time.	They are reversed in subsequent financial years.
The accounting and tax treatments are permanently different.	The difference arises because accounting and tax rules recognise a transaction at different times.
Examples: fines, penalties or certain non-deductible expenses.	Examples: certain depreciation adjustments or tax incentives.

This distinction is particularly important because temporary differences must also be monitored in future financial years to ensure that they are correctly reversed.

Five non-accounting adjustments that should be reviewed carefully

Although there is a wide range of possible situations, certain items account for a significant proportion of the issues identified during Corporate Income Tax reviews.

1. Non-deductible expenses

One of the most common errors is treating expenses as tax-deductible when they are expressly excluded by the regulations or when their connection with the company’s business activity cannot be adequately demonstrated.

These include:

• Fines and penalties.
• Certain gifts and gratuities.
• Expenses that are not sufficiently connected with the generation of income.

What to review before filing Form 200

• Verify that all deducted expenses are related to the company’s business activity.
• Check that sufficient documentation is available to justify their nature and purpose.
• Pay particular attention to representation expenses and any expenses whose deductibility may be questionable.

2. Directors’ remuneration

Remuneration paid to company directors continues to be one of the areas requiring the greatest attention.

Companies should verify that the remuneration is properly provided for in accordance with corporate law, adequately documented and linked to the duties actually performed.

A prior review can help prevent subsequent discrepancies with the Tax Authorities.

What to review before filing Form 200

• Confirm that the remuneration is properly established and documented.
• Verify the corporate resolutions supporting it.
• Check that the remuneration received corresponds to the duties performed.

 

I would like more information

 

3. Depreciation

Differences between accounting and tax criteria regarding depreciation are another common source of non-accounting adjustments.

Tax regulations provide for various incentives, such as certain accelerated depreciation schemes or unrestricted depreciation allowances, which may generate temporary differences compared with the accounting treatment.

What to review before filing Form 200

• Check that the tax depreciation applied meets the requirements established by the regulations.
• Identify any temporary differences that are still pending reversal.
• Verify that incentives applied in previous financial years continue to be properly monitored.

4. Provisions and impairment losses

Not all provisions or impairment losses recognised for accounting purposes have an immediate effect on the taxable base.

In certain circumstances, tax regulations limit or defer their deductibility, making it necessary to apply the corresponding non-accounting adjustments.

What to review before filing Form 200

• Analyse which provisions are tax-deductible.
• Review the treatment of impairment losses recorded during the financial year.
• Retain the documentation supporting the criteria applied.

5. Outstanding adjustments from previous financial years

One of the least visible but most common errors is overlooking adjustments made in previous financial years that still need to be reversed.

Temporary differences require continuous monitoring until they have been fully regularised.

Without this control, duplications, omissions or errors may arise when determining the taxable base.

What to review before filing Form 200

• Check the history of outstanding temporary adjustments.
• Review the tax reconciliation worksheets from previous financial years.
• Verify that reversals are made in the correct financial year.

Errors that continue to be identified during tax inspections

Experience shows that many tax adjustments do not arise from particularly complex transactions, but from shortcomings during the final review of the tax return.

The most common issues include:

• Deducting expenses whose connection with the business activity cannot be sufficiently demonstrated.
• Failing to reverse temporary differences generated in previous financial years.
• Incorrectly applying certain tax incentives.
• Failing to retain the documentation supporting the tax treatment applied.
• Assuming that correct accounting recognition automatically means that an expense is tax-deductible.

Conducting a specific tax review before filing Form 200 can significantly reduce these risks.

Do you need to review your Corporate Income Tax return before filing Form 200?

A proper Corporate Income Tax review involves more than simply completing the tax return. Correctly identifying non-accounting adjustments, reviewing the supporting documentation and verifying the tax treatment applied can make the difference between a correctly filed return and future issues with the Tax Authorities.

At Adlanter, we advise companies on the preparation and review of Corporate Income Tax returns, helping them identify tax risks and correctly apply the regulations in force.

If your company is required to file Form 200 and you would like to review the return before submitting it, our team of specialists can help you.