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A lawyer inquired whether fees based on a percentage of the award should be recognised at the time of the judgment or during the settlement of accounts. The Directorate General of Taxes (DGT) ruled that they must be recognised when the right to receive the amount is determined following the conclusion of the litigation.
This ruling clarifies the timing for tax purposes regarding contingency fees, ensuring that income is recorded only when the specific amount becomes legally certain.
The tax team reviews your specific situation.
Partner-attended · reply within 24 business hours
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