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V0618-22 23 March 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

Court costs imposed may be treated as an expense or capital loss for Personal Income Tax purposes

A landlord has enquired about the tax treatment of court costs incurred following an eviction. The Directorate General for Taxes (DGT) clarifies that these costs do not constitute professional fees but rather compensation paid to the prevailing party, and may be deductible depending on the specific circumstances.

The question raised

Taxation under Personal Income Tax. In the event that one is obliged to satisfy procedural costs, it is requested to know the taxation thereof for the purposes of the same tax.

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