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V0621-22 23 March 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

Unpaid rental income may be deducted as bad debt after three months of collection efforts (in 2021)

A landlord seeks guidance on how to declare rental income in their Personal Income Tax (IRPF) that has remained unpaid since January 2020. The Directorate General of Taxes (DGT) clarifies that the full income must be declared even if not collected, but the debt may be deducted as bad debt once the required collection period has been met.

The question raised

It is asked how this situation affects the Personal Income Tax of the lessor.

The DGT's ruling

The lessor must impute as gross income from real estate capital the lease amounts even if they have not been received. Doubtful debts may be deducted as an expense when three months have elapsed from the first collection attempt until the end of the fiscal year, according to the reduction of the period for 2021. If the debt is collected after having been deducted as an expense, it shall be computed as income in the fiscal year in which the collection occurs.

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