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V2911-21 18 November 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos de actividades económicas

Grants for refurbishing a rural hotel are treated as income from economic activities

A query was raised regarding when a grant received for the rehabilitation of a building used for rural accommodation should be taxed. The DGT has determined that it constitutes income from an economic activity and its temporal allocation depends on the depreciation of the investments.

The question raised

Temporal allocation of the subsidy in Personal Income Tax.

The DGT's ruling

The subsidy is classified as income from economic activities pursuant to Article 27.1 of the Personal Income Tax Law (LIRPF). As it is intended for investments in fixed assets, it is treated as a capital subsidy and must be recognized in the same proportion as the investments made are depreciated. Tangible fixed assets shall begin to be depreciated from the date they are placed in working condition.

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