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A company sought clarification on whether a €175,000 payment to terminate an old-regime lease agreement could be treated as an increase in property value for depreciation purposes. The Directorate General for Taxes (DGT) ruled that this is possible if the compensation represents an improvement to the asset that enhances its future profitability and is not linked to a specific period.
This ruling provides legal certainty for companies looking to capitalise lease termination costs, provided they can demonstrate a direct link to increased asset value and future income.
The tax team reviews your specific situation.
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