Marketing costs – what's the limit for the entrepreneur?

The taxpayer is active in wealth management. The tax authorities are conducting an audit of the accounts and note various expenses recorded as marketing costs:
▶️ Overseas hunting trips
Restaurant
Travel (especially helicopter travel abroad)
Gifts
▶️ Other (CEO's fitness subscription)

The tax authorities consider these costs not to be business expenses.

Federal judges recall that «everything that, from a commercial point of view, may be considered in good faith as part of general expenses must be recognised for tax purposes as justified by commercial practice. It does not matter, on the other hand, whether the company could have done without the expenses in question or whether they were in line with rational, profit-oriented management. It is not for the tax authorities to call into question the appropriateness of an expense» (cons. 5.1. i.i.).

They continue: «The commercial justification for an expense depends on its context. Its actual necessity for the business is not decisive. It is sufficient that there is an objective causal link between the expense and the economic purpose of the business. A causal link exists when the expense would have been incurred by an ordinary manager exercising the objective diligence required by commercial law. If an expense serves the shareholder's maintenance or their own pleasure, the company unduly burdens its profit and loss account by bearing a private expense under the guise of business expenses. As this is a factor in reducing the tax debt, it is up to the taxpayer to prove the commercially justified nature of an expense» (recital 5.1, last part).

👉 Hunting expenses account for more than 50% of the company’s profits. The taxpayer has not provided (sufficient) evidence of contracts secured as a result of these hunting trips.

As for the other disputed expenses, the taxpayer merely states that their accounts are correct, without providing proof that each of the disputed expenses is justified by commercial use.

The ruling is in French. This is a Genevan case.

TF, judgment 9C_513/2025, of 17 December 2025