TOM – calculate interest deductions and optimise tax results

Since the introduction of the current interest deduction limitation rules, group contribution planning has become significantly more challenging, especially if aiming for the most optimal result. This is because group contributions affect how large interest deductions a company may make. A received group contribution increases the deduction space, while a submitted group contribution reduces the amount of deduction space for interest. In addition, there is also the possibility of offsetting positive net interest income that may affect how group contributions should be allocated. Performing this work manually is complex and extremely time-consuming.

Therefore, since the proposal was introduced in 2017, we have developed TOM – Tax Optimisation Model – a digital tool for calculating interest deductions according to current rules and optimising the tax result. 

TOM consists of two parts where the tax calculation and interest deduction calculation are created in Excel, while the optimisation of group contributions and interest income is done by multiple algorithms. The proposal which the algorithms return to Excel follows a priority order that optimises the tax situation for groups. With TOM, it is possible to track each calculation at the legal entity level. There is no actual limitation on how many companies TOM can handle, ranging from one company to hundreds.

By using TOM, you streamline group contribution planning in the highly complex environment created by the current interest deduction limitation rules, while saving time on the manual calculations that are otherwise needed to optimise the result. Of course, there is also the possibility to automatically generate income declarations and N9 forms.