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A catering company has enquired whether renovation works carried out on its premises qualify for the profit reinvestment deduction. The Directorate General for Taxes (DGT) has ruled that if the works are necessary to bring the premises into an operational state, they are considered an increase in the value of fixed assets and therefore qualify for the deduction.
Companies undertaking necessary renovations to bring premises into operational use may be able to reduce their tax liability through the profit reinvestment deduction, provided the costs are capitalised as part of the fixed assets.
The tax team reviews your specific situation.
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