- A company that had its contract terminated by the client before generating expected revenue can claim input tax deduction from legal fees related to claiming damages
- Input tax deduction is possible even if preparatory actions for a business activity are unsuccessful and no revenue is generated
- If a contractor incurs legal fees to claim damages for a terminated project contract, there is a direct connection between the legal fees and the originally planned revenue-generating activity
- The input tax deduction is allowed for legal fees related to claiming non-taxable damages for a terminated project contract.
Source: datenbank.nwb.de
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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