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A taxpayer inquired whether renovations carried out on their property can be included in the acquisition value when calculating capital gains. The Directorate General for Taxes (DGT) ruled that works which increase capacity or habitability are considered improvements or extensions and may be added to the acquisition value.
This ruling clarifies that costs associated with increasing the utility or size of a property are deductible from the sale price, potentially reducing the taxable capital gain.
The tax team reviews your specific situation.
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