diff --git a/src/space-model/services/space-model-product-allocation.service.ts b/src/space-model/services/space-model-product-allocation.service.ts
index 6a477bf..9e95a02 100644
--- a/src/space-model/services/space-model-product-allocation.service.ts
+++ b/src/space-model/services/space-model-product-allocation.service.ts
@@ -14,7 +14,6 @@ import { ModifyAction } from '@app/common/constants/modify-action.enum';
 import { NewTagEntity } from '@app/common/modules/tag';
 import { ProductEntity } from '@app/common/modules/product/entities';
 import { SpaceRepository } from '@app/common/modules/space';
-import { SpaceEntity } from '@app/common/modules/space/entities/space.entity';
 import { ProjectEntity } from '@app/common/modules/project/entities';
 
 @Injectable()
@@ -31,10 +30,11 @@ export class SpaceModelProductAllocationService {
     tags: ProcessTagDto[],
     queryRunner?: QueryRunner,
     modifySubspaceModels?: ModifySubspaceModelDto[],
-    spaces?: SpaceEntity[],
   ): Promise<SpaceModelProductAllocationEntity[]> {
     try {
-      if (!tags.length) return [];
+      if (!tags.length) {
+        return [];
+      }
 
       const processedTags = await this.tagService.processTags(
         tags,
@@ -81,6 +81,7 @@ export class SpaceModelProductAllocationService {
               )
             ) {
               isTagNeeded = true;
+
               break;
             }
           }
@@ -93,7 +94,9 @@ export class SpaceModelProductAllocationService {
             spaceModel,
           );
 
-          if (hasTags) continue;
+          if (hasTags) {
+            continue;
+          }
 
           let allocation = existingAllocations.get(tag.product.uuid);
           if (!allocation) {
@@ -120,9 +123,11 @@ export class SpaceModelProductAllocationService {
       if (productAllocations.length > 0) {
         await this.saveAllocations(productAllocations, queryRunner);
       }
-
       return productAllocations;
     } catch (error) {
+      console.error(
+        `[ERROR] Failed to create product allocations: ${error.message}`,
+      );
       throw this.handleError(error, 'Failed to create product allocations');
     }
   }
@@ -133,7 +138,6 @@ export class SpaceModelProductAllocationService {
     spaceModel: SpaceModelEntity,
     queryRunner: QueryRunner,
     modifySubspaceModels?: ModifySubspaceModelDto[],
-    spaces?: SpaceEntity[],
   ): Promise<void> {
     try {
       const addDtos = dtos.filter((dto) => dto.action === ModifyAction.ADD);
@@ -184,15 +188,8 @@ export class SpaceModelProductAllocationService {
           spaceModel,
           queryRunner,
           modifySubspaceModels,
-          spaces,
-        ),
-        this.processDeleteActions(
-          filteredDtos,
-          queryRunner,
-          spaceModel,
-          project,
-          spaces,
         ),
+        this.processDeleteActions(filteredDtos, queryRunner, spaceModel),
       ]);
     } catch (error) {
       throw this.handleError(error, 'Error while updating product allocations');
@@ -205,7 +202,6 @@ export class SpaceModelProductAllocationService {
     spaceModel: SpaceModelEntity,
     queryRunner: QueryRunner,
     modifySubspaceModels?: ModifySubspaceModelDto[],
-    spaces?: SpaceEntity[],
   ): Promise<void> {
     const addDtos: ProcessTagDto[] = dtos
       .filter((dto) => dto.action === ModifyAction.ADD)
@@ -222,7 +218,6 @@ export class SpaceModelProductAllocationService {
         addDtos,
         queryRunner,
         modifySubspaceModels,
-        spaces,
       );
     }
   }
@@ -298,8 +293,6 @@ export class SpaceModelProductAllocationService {
     dtos: ModifyTagModelDto[],
     queryRunner: QueryRunner,
     spaceModel: SpaceModelEntity,
-    project: ProjectEntity,
-    spaces?: SpaceEntity[],
   ): Promise<SpaceModelProductAllocationEntity[]> {
     try {
       if (!dtos || dtos.length === 0) {
@@ -409,7 +402,7 @@ export class SpaceModelProductAllocationService {
       (allocation) => allocation.tags,
     );
 
-    // Check if the tag is already assigned to the same product in this subspace
+    // Check if the tag is already assigned to the same product in this space
     const isDuplicateTag = existingTagsForProduct.some(
       (existingTag) => existingTag.uuid === tag.uuid,
     );
diff --git a/src/space-model/services/space-model.service.ts b/src/space-model/services/space-model.service.ts
index 6efe5ff..e15c4aa 100644
--- a/src/space-model/services/space-model.service.ts
+++ b/src/space-model/services/space-model.service.ts
@@ -481,7 +481,6 @@ export class SpaceModelService {
             await this.subspaceRepository.save(subspace);
           }
 
-
           const subspaceAllocations = subspaceModel.productAllocations.map(
             (modelAllocation) =>
               this.subspaceProductAllocationRepository.create({
diff --git a/src/space-model/services/subspace/subspace-model.service.ts b/src/space-model/services/subspace/subspace-model.service.ts
index b30ee69..82905ee 100644
--- a/src/space-model/services/subspace/subspace-model.service.ts
+++ b/src/space-model/services/subspace/subspace-model.service.ts
@@ -157,6 +157,7 @@ export class SubSpaceModelService {
         deleteDtos,
         queryRunner,
         spaceModel,
+        spaceTagUpdateDtos,
       );
       return [
         createdSubspaces ?? [],
@@ -182,6 +183,7 @@ export class SubSpaceModelService {
     deleteDtos: ModifySubspaceModelDto[],
     queryRunner: QueryRunner,
     spaceModel: SpaceModelEntity,
+    spaceTagUpdateDtos?: ModifyTagModelDto[],
   ): Promise<ISingleSubspaceModel[]> {
     try {
       if (!deleteDtos || deleteDtos.length === 0) {
@@ -208,12 +210,14 @@ export class SubSpaceModelService {
         { disabled: true },
       );
 
-      const allocationsToRemove = subspaces.flatMap(
-        (subspace) => subspace.productAllocations,
+      const allocationsToRemove = subspaces.flatMap((subspace) =>
+        (subspace.productAllocations || []).map((allocation) => ({
+          ...allocation,
+          subspaceModel: subspace,
+        })),
       );
 
       const relocatedAllocationsMap = new Map<string, IRelocatedAllocation[]>();
-
       if (allocationsToRemove.length > 0) {
         const spaceAllocationsMap = new Map<
           string,
@@ -224,7 +228,6 @@ export class SubSpaceModelService {
           const product = allocation.product;
           const tags = allocation.tags;
           const subspaceUuid = allocation.subspaceModel.uuid;
-
           const spaceAllocationKey = `${spaceModel.uuid}-${product.uuid}`;
 
           if (!spaceAllocationsMap.has(spaceAllocationKey)) {
@@ -261,22 +264,43 @@ export class SubSpaceModelService {
                 allocation: spaceAllocation,
               });
               spaceAllocation.tags.push(...newTags);
+
               await queryRunner.manager.save(spaceAllocation);
             }
           } else {
-            const newSpaceAllocation = queryRunner.manager.create(
-              SpaceModelProductAllocationEntity,
-              {
-                spaceModel: spaceModel,
-                product: product,
+            let tagsToAdd = [...tags];
+
+            if (spaceTagUpdateDtos && spaceTagUpdateDtos.length > 0) {
+              const spaceTagDtosToAdd = spaceTagUpdateDtos.filter(
+                (dto) => dto.action === ModifyAction.ADD,
+              );
+
+              tagsToAdd = tagsToAdd.filter(
+                (tag) =>
+                  !spaceTagDtosToAdd.some(
+                    (addDto) =>
+                      (addDto.name && addDto.name === tag.name) ||
+                      (addDto.newTagUuid && addDto.newTagUuid === tag.uuid),
+                  ),
+              );
+            }
+
+            if (tagsToAdd.length > 0) {
+              const newSpaceAllocation = queryRunner.manager.create(
+                SpaceModelProductAllocationEntity,
+                {
+                  spaceModel: spaceModel,
+                  product: product,
+                  tags: tags,
+                },
+              );
+
+              movedToAlreadyExistingSpaceAllocations.push({
+                allocation: newSpaceAllocation,
                 tags: tags,
-              },
-            );
-            movedToAlreadyExistingSpaceAllocations.push({
-              allocation: newSpaceAllocation,
-              tags: tags,
-            });
-            await queryRunner.manager.save(newSpaceAllocation);
+              });
+              await queryRunner.manager.save(newSpaceAllocation);
+            }
           }
 
           if (movedToAlreadyExistingSpaceAllocations.length > 0) {