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V1559-23 ·6 June 2023 ·consulta-vinculante Medium impact
Tax

Interest on loans from related parties may be capitalised as part of inventory value

A real estate developer sought clarification on whether interest from loans received from its sole shareholder (an Austrian entity) is tax-deductible. The DGT explains that, under accounting standards, these expenses must be capitalised into the value of inventory if the assets require more than one year to be sold.

In 6 key points

How it affects those involved

This ruling affects the tax treatment of financing costs for long-term real estate projects, potentially delaying the deduction of interest expenses by requiring them to be included in the cost of inventory.

Lifecycle

2023-06-06PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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