3. In the direct estimation method, the taxable base will be calculated, correcting, through the application of the precepts established in this law, the accounting result determined with the rules provided in the commercial code.
Therefore, following the previous article, we will have to go to the accounting rules to determine the taxable base for the calculation of the corporate income tax. Specifically, to the rules for the valuation of tangible fixed assets.
The acquisition price includes, in addition to the amount invoiced by the seller after deducting any discount or REDUCTION IN PRICE, all additional and directly related expenses incurred until they are put in operating conditions, including the location on the site and any other condition necessary for them to operate as intended; among others, EXPENSES OF EXPLANATION AND DISPOSAL, transport,…
Unbuilt plots of land. Included in their acquisition price will be the costs of developments, such as closures, earthworks, drainage and sewage works, THE EXPENSES FOR THE DISMANTLING OF CONSTRUCTIONS WHEN NECESSARY IN ORDER TO CARRY OUT NEW PLANT WORKS,…
How is the demolition of a building accounted for?
Technical File Tax Area Deduction of expenses of vehicles assigned to management, representation and administration activities Author : C.P.C. Josué Alfredo Bernal Rojas Title : Deduction of expenses
Deduction of Expenses of Vehicles Assigned to Management, Representation and Administration Activities 1. Introduction Since January 1, 2013, the amendments to the Tax Law have been in force.
DEDUCTIBLE EXPENSES SUBJECT TO THE LIMIT FOR THE DETERMINATION OF INCOME TAX 1. EXPENSES OF VEHICLES ASSIGNED TO MANAGEMENT AND REPRESENTATION ACTIVITIES Consultation The general manager of the company
I-1 Operations Excluded From Withholding I-1 Withholding Voucher: I-2 Model Withholding Voucher I-3 Withholding Agent’s Declaration and Payment I-3 Withholding Agent’s Declaration and Payment
ARTICLE 12 – GROSS TAX CHAPTER V GROSS TAX The Gross Tax corresponding to each taxable transaction is the amount resulting from applying the Tax rate to the taxable base. The
Demolition costs accounting
It is essential to distinguish between improvement works and conservation works. Not only to apply for building permits, but also to know whether an operation is subject to amortization or is considered an expense for the year.
In this situation it is necessary to know what parameters are taken into account to consider it as improvement work, and therefore subject to amortization, or if, on the contrary, it is considered as repair and conservation work, and then considered as an expense.
However, Article 10.3 of this law establishes that “in the direct estimation method, the taxable base will be calculated by correcting, through the application of the precepts established in this law, the accounting result determined in accordance with the rules set forth in the Commercial Code, in the other laws relating to such determination and in the provisions issued in development of the aforementioned rules”.
According to this rule, “the acquisition price includes, in addition to the amount invoiced by the seller after deducting any discount or rebate in the price, all additional and directly related expenses incurred until it is put in operating conditions, including the location on the site and any other condition necessary for it to operate in the intended manner; among others: expenses of grading and demolition, transportation, customs duties, insurance, installation, assembly and other similar expenses”.
Can you deduct demolition expenses? 2022
In view of the situation of the applicant’s house, the competent municipality requests the applicant either to repair the damage or to proceed with the demolition of the house. The claimant proceeds with the demolition.
Article 33.1 of Law 35/2006, of November 28, on Personal Income Tax and partial amendment of the laws on Corporate Income Tax, Non-Resident Income Tax and Wealth Tax (BOE of November 29), hereinafter LIRPF, provides as follows:
“Capital gains and losses are the variations in the value of the taxpayer’s assets that become apparent on the occasion of any alteration in the composition thereof, unless they are classified by this Law as income.”.
In the first place, the demolition of the house of which the taxpayer is the owner, insofar as it entails its disappearance, constitutes an alteration in the composition of his patrimony that gives rise to a variation in its value (capital gain or loss). The amount of this capital gain or loss will be determined in accordance with the provisions of article 34 of the LIRPF, by the difference between the acquisition and transfer values, values which are defined in articles 35 and following of the same Law.