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V1449-21 18 May 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

The limit for accumulated property depreciation is its acquisition value

The taxpayer inquires about the limit for accumulated depreciation on leased properties. The DGT rules that, while there is an annual limit for deductible expenses, the total accumulated depreciation cannot exceed the acquisition value of the property.

The question raised

Limit of the accumulated depreciation.

The DGT's ruling

For income from real estate capital, the annual deductible depreciation may not exceed 3 percent of the higher of the acquisition cost (excluding land) or the cadastral value (excluding land). Notwithstanding, the acquisition value for calculating capital gains or losses must be reduced by the tax-deductible depreciation. Therefore, the accumulated depreciation is limited by the acquisition value of the property, as this cannot be negative.

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