The investment in working capital at the start of an investment project can not be deducted from revenues when computing taxable income.

Question

Quizplus · Accepted Answer

The investment in working capital is considered a part of the initial investment made in the project and cannot be deducted from revenues as an operating cost when computing taxable income. However, the expenses incurred in maintaining the working capital, such as interest payments and storage costs, can be deducted as operating costs.

The Investment in Working Capital at the Start of an Investment