- Definition of Capital Goods: The Value Added Tax Act defines capital goods, which include machinery and real property, establishing the criteria for input tax deduction based on the connection to taxable activities and the cost threshold for classification.
- Intended Maintenance Rule: The rule allows for costs of work that involve improvements but are primarily for maintenance to be immediately deductible. Only costs that cannot be linked to intended maintenance need to be capitalized, maintaining the functional properties of the asset.
- Directorate of Taxes’ Position: The Directorate supports applying the intended maintenance rule to the understanding of building measures in the VAT Act, despite potential complexity. The assessment aligns with income tax principles, ensuring consistent treatment of costs regarding maintenance versus improvements.
Source: skatteetaten.no
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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