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V2498-14 24 September 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

Electricity costs recharged to tenants are income and deductible expenses for real estate capital

An office owner asks whether electricity consumption recharged to tenants can be declared as income and deducted as an expense. The DGT rules that these amounts count as gross income and are, in turn, deductible.

The question raised

Whether the treatment applied to electricity consumption expenses and the deductibility of a series of expenses incurred by the taxpayer, which they consider necessary for the generation of income, is correct.

The DGT's ruling

Expenses for electricity consumption recharged to tenants are computed as gross income from real estate capital and are deductible. For all other expenses not expressly mentioned, their deductibility depends on whether they are necessary for the generation of income, which is a matter of fact that must be substantiated with evidence.

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