Costs for adaptation renovations in relatives' homes are not deductible for Personal Income Tax (IRPF)

The cost of carrying out adaptation works in a relative's home to improve its habitability does not generate a right to a deduction in the Personal Income Tax (IRPF) tax liability. This issue has been clarified by the Administration to delimit the scope of the tax benefits provided for in state regulations.

What the DGT has resolved

The Dirección General de Tributos (DGT) determines that Law 35/2006 (LIRPF) does not contemplate deductions in the tax liability nor specific tax benefits on the grounds that a taxpayer covers the costs of a renovation in a home, regardless of whether the taxpayer holds ownership of the property or not. The technical criterion indicates that state regulations do not provide for this type of incentive for adaptation expenses in properties owned by third parties or relatives.

However, the Administration clarifies that these expenses could have an indirect impact on the tax return. This occurs through the personal and family minimum, as the reduction of the taxable base or the application of the zero-rate bracket may reflect the taxpayer's economic situation, but it does not constitute a direct deduction for the investment made in the work.

What this means for you

If you have made a financial investment to adapt a relative's home, you should know that you will not be able to apply a state deduction in your tax return for this concept. The lack of ownership of the property and the absence of an express provision in the IRPF Law prevent these expenses from being computed as a direct deduction in the tax liability.

What you should do

In this situation, it is necessary to consider the following points:

• Verify regional regulations: Although state law does not allow the deduction, some Autonomous Communities have their own incentives for adaptation works or accessibility improvements. It is essential to check if the legal requirements are met in your region.
• Analyze the impact on the personal minimum: Evaluate how the expenditure situation may influence the calculation of the personal and family minimum in your tax return.
• Assess each particular case: Since the application of tax benefits depends on the exact nature of the work and tax residence, it is recommended to analyze the specific situation before filing the tax return.