Christmas, your birthday, the first summer dip… Every year, there are certain moments that come around again and again. Most are cause for celebration, just like finally finding a house to call home. However, there are others that are not so welcome. One of them is the Income Tax Return, a formality that is as necessary as it is tedious sometimes for some people.
However, if you are renting a property, this obligation brings good news: there are expenses that you can deduct as a tenant. We’ll explain how you can do this, both in the case of state and regional deductions, which may vary depending on where you live.
What is the state deduction when you are a tenant?
The first thing you should know is that this deduction no longer applies to all rental contracts. More specifically, it only applies to those signed before 1 January 2015. If this is not your case, don’t walk away just yet: further on in this post, we’ll take a look at the existing regional deductions.
If your contract is prior to that date, you’re in luck and will be eligible for a 10.05% deduction on the amounts paid in the corresponding tax period, although there is a requirement: the taxable base for personal income tax relief must be less than €24,107.20. And that’s not the only requirement: of course, your name must appear on the rental contract, the rented property must be your main residence, and you must be registered as a resident in the town where the property is located.
Which box do you use to deduct rent?
If you comply with all of the above, when you make your annual income tax return, you will simply have to include all the information in box 562*. Important: your landlord must also include his or her status as landlord of the property.
In addition, you will need to consider the following boxes:
- 715-718: Tax ID number of the lessor.
- 719: Total amount paid to the lessor. If there is more than one landlord, use box 720 also for the amounts paid to the landlord.
- 721: Amount of the deduction for renting the main residence.
What are the regional deductions for housing?
In addition to the state component, some regions have the possibility of including a regional deduction. In the case of Be Casa Essential locations, if you have rented any of our properties in Madrid, Andalusia or Valencia, take note of the deductions.
Andalusia
In this region, the deduction for renting your main residence applies to young people -up to 35 years of age- or to people over 65, as well as other cases, such as victims of terrorism or domestic violence.
People in any of these situations must fill in box 853 and can benefit from 15% of the rent paid up to a maximum of €600 per year or €900 if they are a person with a disability.
Autonomous Community of Madrid
Again, people under 35 years of age are eligible for this deduction, which is 30% of the amounts paid up to a maximum of €1,000.
People under 40 who are unemployed or have family responsibilities can also apply for the deduction in the Community of Madrid.
In both cases, you must fill in box 1043 of the Income Tax Return.
Autonomous Community of Valencia
Valencia is one of the regions with the most options for rent tax relief for tenants. Below is a list of the various alternatives for deducting the main residence, which must be entered in box 1095:
- A deduction of 20% of the amount paid up to a maximum of €800.
- A 25% deduction, with a limit of €950, if you are under 35, a victim of gender violence or suffer from a 65% physical or sensory disability or a 33% mental disability.
- A 30% deduction, up to a maximum of €1,100, if you have more than one of the conditions mentioned in the previous point.
In addition, there is another option that is not so common. If you have had to rent a property in a municipality other than your own for work purposes, and as long as it is more than 100 kilometres from your home town, you will be able to deduct 10% of the amount paid up to a maximum of €224. If this is your situation, you should fill in box 1097. This benefit is also compatible with the main residence deduction.
In short, when it’s time for the Income Tax Return, and if you meet the established requirements, don’t miss the opportunity to take advantage of state or regional deductions. Your wallet will certainly appreciate it.
*The information regarding the boxes has been updated to the 2022 Income Tax Return. Consult at the time of filing your tax return.
