Deductions - During the year of assessment

Question 1

Facts:

A TP company paid insurance premiums on a loss of profits insurance policy. The insurance policy will only pay out in future, if certain events took place. (In the event the TP company losses profits).

Answer 1

Sub- Nigel Ltd

Issue:
Are the insurance premiums deductible even though the income from those claims was not received in the same year?

Principle:
An expense has to be deducted in the year of assessment it was incurred, even if it will only produce income in future years. (Matching concept is irrelevant).