Puigverd Assessors analyzes the new tax incentives in personal income tax on property leases for housing
New tax incentives in personal income tax on property leases for housing
26/06/2023
On May 25, Law 12/2023, of May 24, for the right to housing, was published in the Official State Gazette (BOE), which includes a series of tax incentives applicable to personal income tax. physical in the leases of real estate intended for housing.
This new law consists of more tax reductions in personal income tax for owners who rent their home to young people, for those who reduce rental income in the review of the contract, and for those who have rehabilitated the rented home.
On the other hand, the possibility of increasing the IBI (enables the municipalities) is opened in the case of empty, non-rented homes. There are two important points to take into account in this new regulation : the reduction for housing rentals for rental contracts entered into from May 26, 2023 and the reduction for housing rentals for rental contracts entered into before May 26th. of 2023.
In lease contracts from May 26, 2023, as determined by the Tax Agency on this law, section 2 of article 23 of Law 35/2006, of November 28, on income tax is modified of natural persons (LIRPF) by section 1 of the second final provision of Law 12/2023, of May 24, for the right to housing.
There is a modulation of the current 60% reduction and it is established that the positive net return will be reduced as of January 1, 2024:
To the positive net returns of real estate capital derived from housing lease contracts that have been entered into prior to the entry into force of Law 12/2023, of May 24, for the right to housing, the planned reduction is applicable in section 2 of article 23 of this Law to the wording in force as of December 31, 2021 (60%).
As explained by the Puigverd Assessors team , after analyzing this law, it should not be ruled out that, as has happened on previous occasions, the Tax Administration makes generalized reviews of the reduction percentage applied by taxpayers once the new comes into force. regulation.
Given the complexity of the different cases contemplated, taxpayers must pay attention to this issue in order to adequately comply with their tax obligations.
This new law consists of more tax reductions in personal income tax for owners who rent their home to young people, for those who reduce rental income in the review of the contract, and for those who have rehabilitated the rented home.
On the other hand, the possibility of increasing the IBI (enables the municipalities) is opened in the case of empty, non-rented homes. There are two important points to take into account in this new regulation : the reduction for housing rentals for rental contracts entered into from May 26, 2023 and the reduction for housing rentals for rental contracts entered into before May 26th. of 2023.
Reduction for housing lease for lease contracts entered into from May 26, 2023
In lease contracts from May 26, 2023, as determined by the Tax Agency on this law, section 2 of article 23 of Law 35/2006, of November 28, on income tax is modified of natural persons (LIRPF) by section 1 of the second final provision of Law 12/2023, of May 24, for the right to housing.
There is a modulation of the current 60% reduction and it is established that the positive net return will be reduced as of January 1, 2024:
- 90% when the landlord has formalized a new lease on a home located in areas with a stressed residential market, with a reduction in rent of at least 5% over the previous contract.
- 70% when, the requirements of the previous letter are not met, it involves the incorporation into the housing market for rental in areas with a stressed residential market and young people between the ages of 18 and 35 are rented in these areas, or, It concerns incentivized or protected affordable housing, leased to the public administration or entities of the third sector or of the social economy that have the status of non-profit entities, or hosted by a public housing program that limits rental income.
- 60% when, not meeting the requirements of the previous letters, the house has been the subject of a rehabilitation action that has ended the two years prior to the date of signing the contract.
- 50% in another case.
Housing lease reduction for leases entered into before May 26, 2023
In the case of lease contracts entered into before May 26, 2023 , a thirty-eighth transitory provision is incorporated into the LIRPF by section 2 of the second final provision of Law 12/2023, of May 24, by the right to housing.To the positive net returns of real estate capital derived from housing lease contracts that have been entered into prior to the entry into force of Law 12/2023, of May 24, for the right to housing, the planned reduction is applicable in section 2 of article 23 of this Law to the wording in force as of December 31, 2021 (60%).
As explained by the Puigverd Assessors team , after analyzing this law, it should not be ruled out that, as has happened on previous occasions, the Tax Administration makes generalized reviews of the reduction percentage applied by taxpayers once the new comes into force. regulation.
Given the complexity of the different cases contemplated, taxpayers must pay attention to this issue in order to adequately comply with their tax obligations.