The 2023 tax season has officially begun. Since April 3rd, taxpayers have been able to file their rental income declarations online. If you’re a property owner, it’s essential to include the income earned from your rental property to avoid legal consequences. According to the union of treasury technicians, a significant 40% of rental income goes undeclared.

Verifying and Declaring Rentals

The Tax Agency has various methods to detect undeclared rentals, such as analyzing utility consumption and cadastral data, or even cross-referencing information from tenants who claim tax benefits. It is crucial for property owners to be well-informed on how to correctly declare this income.

Important Deductions for the 2023 Tax Return

Property owners who rent their property as a tenant’s habitual residence can benefit from a 60% deduction on their net income. This means they will only be taxed on 40% of the profits earned. It’s important to note that this deduction only applies to properties rented as a primary residence

Anticipated Changes for the 2024 Tax Return

The recent housing law has introduced significant changes to the personal income tax (IRPF) for owners who rent out their homes. For the 2024 tax return, you can apply for deductions of up to 90% if you renew a contract in “stressed” residential market areas with a rent reduction of more than 5%. Other deductions include 70% for new leases in these areas to tenants between 18 and 35 years old, and 60% if the property has been recently renovated.

Other Deductible Expenses

In addition, owners can deduct expenses such as:

  • Fees for real estate agencies or management services for drafting contracts.
  • Home and non-payment insurance.
  • Utility and service costs, if paid by the owner.
  • Mortgage loan interest, municipal fees like cleaning or IBI, and community fees.
  • Costs of repairs, habitability improvements, and property amortization.

With these preparations and a clear understanding of the available deductions, you can navigate the tax process more effectively. con confianza y eficacia, asegurando que cumplen con la ley mientras optimizan su carga fiscal.