{"id":10965,"date":"2026-03-20T12:18:45","date_gmt":"2026-03-20T12:18:45","guid":{"rendered":"https:\/\/asesoriafenix.com\/?p=10965"},"modified":"2026-03-11T08:51:00","modified_gmt":"2026-03-11T08:51:00","slug":"how-to-save-on-a-property-renovation-and-sale","status":"publish","type":"post","link":"https:\/\/asesoriafenix.com\/en\/how-to-save-on-a-property-renovation-and-sale\/","title":{"rendered":"How to save on a property renovation and sale"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"10965\" class=\"elementor elementor-10965 elementor-10515\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-fd883e6 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"fd883e6\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-a6f69c6\" data-id=\"a6f69c6\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-b463b8c elementor-widget elementor-widget-text-editor\" data-id=\"b463b8c\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p>Renovating a property in order to sell it is a process that many homeowners undertake in the hope of making a significant profit. However, for the operation to be truly profitable, it is crucial to apply <a href=\"https:\/\/asesoriafenix.com\/servicios\/asesoria-fiscal-y-contable-para-empresas\/\">smart fiscal strategies<\/a>. Knowing how to save on renovating and selling a property is not only about choosing the right materials or making the right renovations, but also about understanding the tax implications that affect your investment.  <\/p><p>This article will guide you through the essential steps to optimize your renovation and ensure that the sale of the property is financially beneficial.<\/p><h3><strong>Refurbishing to sell: The difference between maintenance and upgrading<\/strong><\/h3><p>One of the main mistakes homeowners make when renovating to sell is not understanding the difference between what constitutes maintenance and what is considered an improvement in tax terms. This distinction is critical to saving on taxes when selling a property. <\/p><h3><strong>Maintenance vs Improvement<\/strong><\/h3><ul><li><strong>Maintenance:<\/strong> Actions that preserve the property in its original state. This includes activities such as repairing cracks, painting walls, or fixing faucets. While these actions are necessary to keep the property in good condition, they do not increase its value for tax purposes.  <\/li><li><strong>Improvement:<\/strong> On the other hand, improvements are renovations that increase the value of the property, such as the installation of double glazed windows, complete renovation of the kitchen or enlargement of spaces. Improvements do add to the acquisition value of the property and therefore help to reduce the capital gain when sold. <\/li><\/ul><p>Make sure that any improvement expenses are well documented and supported by detailed invoices. The difference between the two items can have a significant impact on the amount of taxes you will have to pay after the sale. <\/p><h3><strong>The importance of documentation in the reform<\/strong><\/h3><p>Not having proper documentation is one of the most common mistakes that can cost you a lot of money. The IRS requires clear proof of all expenses related to the renovation, and it is not enough to have generic invoices. It is essential that the invoices are detailed and that the payment of each expense is justified.  <\/p><ul><li><strong>Complete invoice:<\/strong> It must include the supplier&#8217;s name, VAT number, property address, detailed description of the work performed and the total amount. An invoice vaguely titled &#8220;general renovation&#8221; is not sufficient. <\/li><li><strong>Proof of payment:<\/strong> Payments must be made through traceable means such as bank transfers, cards or nominative checks. Avoid the use of cash, as the Tax Authorities may not accept these payments as valid proof. <\/li><li><strong>Contracts or estimates:<\/strong> Although they are not mandatory, it is always advisable to have a signed contract or an accepted estimate before starting the renovation.<\/li><li><strong>Building permits:<\/strong> If the renovation requires specific permits, make sure you have them and keep them properly.<\/li><\/ul><p>By having all these documents well organized, you will be prepared to justify any expenses and avoid tax surprises at the time of sale.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-fe50b90 elementor-align-center elementor-widget elementor-widget-button\" data-id=\"fe50b90\" data-element_type=\"widget\" data-widget_type=\"button.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<div class=\"elementor-button-wrapper\">\n\t\t\t\t\t<a class=\"elementor-button elementor-button-link elementor-size-sm\" href=\"https:\/\/asesoriafenix.com\/contacto\/\">\n\t\t\t\t\t\t<span class=\"elementor-button-content-wrapper\">\n\t\t\t\t\t\t\t\t\t<span class=\"elementor-button-text\">WE HELP YOU WITH YOUR TAXATION<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-21e2230 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"21e2230\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-9b3bbd1\" data-id=\"9b3bbd1\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-7b6bcdd elementor-widget elementor-widget-text-editor\" data-id=\"7b6bcdd\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<h3><strong>Common mistakes to avoid<\/strong><\/h3><p>Often, homeowners fall into certain common mistakes that can result in a bad tax return and, therefore, in an overpayment of taxes. Here I explain some of them: <\/p><ul><li><strong>Not separating maintenance from improvement:<\/strong> As I mentioned earlier, maintenance does not increase the value of the property, while improvements do. It is crucial that you are clear on what type of work you performed and how it affected the value of the property. <\/li><li><strong>Not counting purchase or inheritance costs:<\/strong> When selling a property, you should not only consider the sale price and the renovations made. It is also important to include the purchase costs, such as notary, registration and taxes, as well as any inheritance-related expenses if that is the case. <\/li><li><strong>Not to register the amortizations:<\/strong> If the property has been rented before the sale, you must take into account the depreciation of the property, since Hacienda will consider it when calculating the capital gain. Even if you have not applied the depreciation in your previous tax returns, it is important to include it in the final calculation. <\/li><\/ul><h3><strong>How to optimize capital gains<\/strong><\/h3><p>In order to correctly calculate the capital gain, you must subtract the acquisition price, the associated expenses and the renovations made from the sale price. However, you must also take into account other factors that may influence the calculation: <\/p><ul><li><strong>Purchase costs:<\/strong> Be sure to include all costs related to the purchase, such as notary, registration, brokers and purchase taxes.<\/li><li><strong>Amortization:<\/strong> If the property was rented at any time, you will have to consider the amortizations of the period in which it was rented. This will reduce the final capital gain. <\/li><li><strong>Municipal capital gains tax:<\/strong> Do not forget that, in addition to the capital gains tax, you will also have to pay the municipal capital gains tax, which is a municipal tax on the increase in value of urban land.<\/li><\/ul><p>Once you have included all these factors, you will be able to calculate more accurately how much you will actually earn from the sale of the property and how to optimize the taxes you will pay.<\/p><h3><strong>Tax strategies according to your profile<\/strong><\/h3><p>Once you have all these aspects in mind, it is crucial to choose the best tax strategy for your situation. The options vary depending on whether you act as an occasional individual, self-employed or through a company.<\/p><ul><li><strong>Occasional individual:<\/strong> If you carry out a purchase-reform-sale operation from time to time, you will be taxed in the savings base, with tax rates ranging from 19% to 30%. However, it is important that everything is well documented to avoid problems with the tax authorities.<\/li><li><strong>Self-employed who reform and sell:<\/strong> If you carry out this type of operations on a regular basis, the Treasury could consider you as an entrepreneur, and you would be taxed in the general IRPF base, with rates that can reach up to 47%. In addition, you will be able to deduct more expenses related to the activity, such as furniture, household appliances or commercial vehicles.<\/li><li><strong>Company:<\/strong> For those who have a high volume of operations, the creation of an asset-holding or trading company is an option. The gain is subject to corporate income tax, with tax rates ranging from 15% to 25%. This option allows greater flexibility to reinvest profits and optimize taxation.<\/li><\/ul><p>Each of these models has advantages and disadvantages, so it is important to analyze your profile and long-term objectives before deciding which is the best option for you.<\/p><h3><strong>Conclusion<\/strong><\/h3><p>Knowing how to save on the renovation and sale of a property requires careful planning and a good knowledge of the taxation related to the renovation and sale of real estate. Be sure to distinguish between maintenance and improvement, keep all relevant documentation and choose the right tax strategy according to your profile. By doing so, you will be able to maximize your profits and minimize taxes, ensuring a successful and profitable sale.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-62a7b50 elementor-align-center elementor-widget elementor-widget-button\" data-id=\"62a7b50\" data-element_type=\"widget\" data-widget_type=\"button.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<div class=\"elementor-button-wrapper\">\n\t\t\t\t\t<a class=\"elementor-button elementor-button-link elementor-size-sm\" href=\"https:\/\/open.spotify.com\/episode\/4QNYfnn0Qz2FnVh1nGTpca\" target=\"_blank\" rel=\"noopener\">\n\t\t\t\t\t\t<span class=\"elementor-button-content-wrapper\">\n\t\t\t\t\t\t<span class=\"elementor-button-icon\">\n\t\t\t\t<i aria-hidden=\"true\" class=\"fab fa-spotify\"><\/i>\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t<span class=\"elementor-button-text\">LISTEN MORE ON SPOTIFY<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-b672ce9 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"b672ce9\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-a28ab97\" data-id=\"a28ab97\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-729eacf elementor-widget elementor-widget-text-editor\" data-id=\"729eacf\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<h2><strong>Frequently asked questions about budget optimization in a remodeling project<\/strong><\/h2><h3><strong>How can I know if an expense is deductible in the reform?<\/strong><\/h3><p>An expense is deductible if it is directly related to a property improvement and is duly justified with an itemized invoice. Ordinary maintenance expenses are not considered deductible.<\/p><h3><strong>Can I deduct the cost of appliances?<\/strong><\/h3><p>Depends. If the appliances are part of a structural alteration (such as an integrated kitchen), you can deduct them. If purchased separately, no.<\/p><h3><strong>Are the architect&#8217;s fees deductible?<\/strong><\/h3><p>Yes, the architect&#8217;s or decorator&#8217;s fees are deductible as long as they are linked to an actual improvement of the property.<\/p><h3><strong>How does inheritance affect reform taxation?<\/strong><\/h3><p>If you inherit a property and make an improvement, you can deduct the improvement expenses. The acquisition value will be that of the adjudication deed, and the reforms are added to the acquisition value.<\/p><h3><strong>How is the capital gain calculated?<\/strong><\/h3><p>The capital gain is calculated by subtracting the acquisition price, purchase costs and renovations from the sale price. Other expenses such as municipal capital gains and depreciation if the property was rented must also be taken into account.<\/p><h3><strong>What if I don&#8217;t have the proper documentation?<\/strong><\/h3><p>If you do not have the proper documentation to justify the reform expenses, Hacienda may not accept them, resulting in higher taxation and possible penalties.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Renovating a property in order to sell it is a process that many homeowners undertake in the hope of making a significant profit. However, for the operation to be truly profitable, it is crucial to apply smart fiscal strategies. Knowing how to save on renovating and selling a property is not only about choosing the &hellip;<\/p>\n<p class=\"read-more\"> <a class=\"\" href=\"https:\/\/asesoriafenix.com\/en\/how-to-save-on-a-property-renovation-and-sale\/\"> <span class=\"screen-reader-text\">How to save on a property renovation and sale<\/span> Read More &raquo;<\/a><\/p>\n","protected":false},"author":2,"featured_media":10960,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"default","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","_joinchat":[],"footnotes":""},"categories":[1],"tags":[],"class_list":["post-10965","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-sin-categoria"],"_links":{"self":[{"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/posts\/10965","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/comments?post=10965"}],"version-history":[{"count":1,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/posts\/10965\/revisions"}],"predecessor-version":[{"id":10966,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/posts\/10965\/revisions\/10966"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/media\/10960"}],"wp:attachment":[{"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/media?parent=10965"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/categories?post=10965"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/asesoriafenix.com\/en\/wp-json\/wp\/v2\/tags?post=10965"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}