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A taxpayer inquired whether the costs of demolishing a property and clearing debris can be added to the land's acquisition value to calculate capital gains. The Directorate General for Taxes (DGT) ruled that these expenses constitute investments and improvements that increase the value of the land.
This ruling allows taxpayers to reduce their taxable capital gains by including demolition and site clearance costs as part of the land's acquisition value.
The tax team reviews your specific situation.
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