Cap on the deductibility of net financial charges at €3m or 30% of adjusted taxable income

Article 34 of the 2019 Finance Act transposes Article 4 of Directive (EU) 2016/1164 (ATAD). Net financial charges of companies subject to corporate income tax are deductible only up to the higher of €3m or 30% of taxable income before financial charges, depreciation and provisions (Art. 212 bis of the General Tax Code; Art. 223 B bis for tax-consolidated groups). Safeguard and carry-forward clauses are provided, with a stricter limit in cases of thin capitalisation. The scheme replaces the 25% cut and the "Carrez amendment". Applicable to financial years beginning on or after 1 January 2019.