税控除

ほぼすべての所得税制度では、売上原価の控除が認められています。これは費用、総収入の減額^{[ 4 ]}、または単に純利益の計算に使用される要素^{[ 5 ]}とみなされる場合があります。 売上原価の決定方法には、さまざまな会計方法を含む、いくつかの固有の複雑さがあります。これらには以下が含まれます。

• 特定の商品を特定することが不可能な場合に、販売された特定の商品にコストを割り当てるための慣例。^{[ 6 ]}
• 工場負担などの共通コストを特定の商品に配分する方法。^{[ 7 ]}
• 売上原価または販売予定原価を計算する際に、いつ原価が認識されるかを決定する方法。^{[ 8 ]}
• 売れない商品や価値が下がった商品の原価を認識する方法。^{[ 9 ]}

Many systems, including the United Kingdom, levy tax on all chargeable "profits of a trade" computed under local generally accepted accounting principles (GAAP).^[10] Under this approach, determination of whether an item is deductible depends upon accounting rules and judgments. By contrast, the U.S. allows as a deduction "all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business..."^[11] subject to qualifications, enhancements, and limitations.^[12] A similar approach is followed by Canada, but generally with fewer special rules. Such an approach poses significant definitional issues. Among the definitional issues often addressed are:

• What constitutes a trade or business? Generally, the business must be regular, continuous, substantial, and entered into with an expectation of profit.^[13][14]
• What expenses are ordinary and necessary? The phrase deals with what expenses are appropriate to the nature of the business, whether the expenses are of the sort expected to help produce income and promote the business, and whether the expenses are not lavish and extravagant.

Note that under this concept, the same sorts of expenses are generally deductible by business entities and individuals carrying on a trade or business. To the extent such expenses relate to the employment of an individual and are not reimbursed by the employer, the amount may be deductible by the individual.^[15]

Business deductions of flow-through entities may flow through as a component of the entity's net income in some jurisdictions. Deductions of flow-through entities may pass through to members of such entities separately from the net income of the entity in some jurisdictions or some cases. For example, charitable contributions by trusts, and all deductions of partnerships (and S corporations in the U.S.) are deductible by member beneficiaries or partners (or S corporation shareholders) in a manner appropriate to the deduction and the member, such as itemized deductions for charitable contributions or a component of net business profits for business expenses.^[16]

One important aspect of determining tax deductions for business expenses is the timing of such deduction. The method used for this is commonly referred to as an accounting method. Accounting methods for tax purposes may differ from applicable GAAP. Examples include timing of recognition of cost recovery deductions (e.g., depreciation), current expensing of otherwise capitalizable costs of intangibles,^[17] and rules related to costs that should be treated as part of cost of goods not yet sold.^[18] Further, taxpayers often have choices among multiple accounting methods permissible under GAAP and/or tax rules. Examples include conventions for determining which goods have been sold (such as first-in-first-out, average cost, etc.), whether or not to defer minor expenses producing benefit in the immediately succeeding period, etc.

Accounting methods may be defined with some precision by tax law, as in the U.S. system, or may be based on GAAP, as in the UK system.

Many systems limit particular deductions, even where the expenses directly relate to the business. Such limitations may, by way of example, include:

• Maximum deductions for use of automobiles^[19]
• Limits on deducting compensation of certain key employees^[20]
• Limits on lobbying or similar expenditures^[21]
• Nondeductibility of payments considered in violation of public policy, such as criminal fines^[22]
• Limits on deductions for business-related entertainment but no limit in 2021 taxes and beyond.^[23]

In addition, deductions in excess of income in one endeavor may not be allowed to offset income from other endeavors. For example, the United States limits deductions related to passive activities to income from passive activities.^[24]

In particular, expenses that are included in COGS cannot be deducted again as a business expense. COGS expenses include:

• The cost of products or raw materials, including freight or shipping charges;
• The cost of storing products the business sells;
• Direct labor costs for workers who produce the products; and
• Factory overhead expenses.

In 2005, the Australian government amended its taxation legislation to remove deductions for expenses incurred in conducting criminal business activities. This came after the Federal Court ruled in Commissioner of Taxation v La Rosa that a heroin dealer was entitled to a tax deduction for money stolen from him in a drug deal.^[25]

Many systems allow a deduction for loss on sale, exchange, or abandonment of both business and non-business income producing assets. This deduction may be limited to gains from the same class of assets. In the U.S., a loss on non-business assets is considered a capital loss, and deduction of the loss is limited to capital gains. Also, in the U.S. a loss on the sale of the taxpayer's principal residence or other personal assets is not allowed as a deduction except to the extent due to casualty or theft.

Many jurisdictions allow certain classes of taxpayers to reduce taxable income for certain inherently personal items. A common such deduction is a fixed allowance for the taxpayer and certain family members or other persons supported by the taxpayer. The U.S. allows such a deduction for "personal exemptions" for the taxpayer and certain members of the taxpayer's household.^[37] The UK grants a "personal allowance".^[38] Both U.S. and UK allowances are phased out for individuals or married couples with income in excess of specified levels.

In addition, many jurisdictions allow reduction of taxable income for certain categories of expenses not incurred in connection with a business or investments. In the U.S. system, these (as well as certain business or investment expenses) are referred to as "itemized deductions" for individuals. The UK allows a few of these as personal reliefs. These include, for example, the following for U.S. residents (and UK residents as noted):

• Medical expenses (in excess of 7.5% of adjusted gross income)^[39]
• State and local income and property taxes (the SALT deduction in the United States)^[40]
• Interest expense on certain home loans^[41]
• Gifts of money or property to qualifying charitable organizations, subject to certain maximum limitations,^[42]
• Losses on non-income-producing property due to casualty or theft,^[43]
• Contribution to certain retirement or health savings plans (U.S. and UK),^[44]
• Certain educational expenses.^[45]

Many systems provide that an individual may claim a tax deduction for personal payments that, upon payment, become taxable to another person, such as alimony.^[46] Such systems generally require, at a minimum, reporting of such amounts,^[47] and may require that withholding tax be applied to the payment.^[48]