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V1323-23 18 May 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · deducción por inversión en vivienda habitual

Right to tax deduction for principal residence investment maintained when replacing one loan with another in a single transaction

A taxpayer inquired whether they could continue to claim a tax deduction for investment in their principal residence after redeeming their current mortgage and taking out a new one with a different lender. The Directorate General for Taxes (DGT) ruled that replacing one loan with another does not exhaust the right to the deduction, provided the substitution is carried out simultaneously.

The question raised

Whether, after performing the restructuring operation through the cancellation and new contracting of a loan, the same right to deduct will be maintained for the amounts that it amortizes or satisfies.

The DGT's ruling

The novation, subrogation, or substitution of a loan does not conclude the financing process nor exhaust the possibilities for the deduction, provided that the new loan is intended for the amortization of the previous one. To maintain the right, the cancellation of the original loan and the signing of the new contract must occur in a single act or simultaneously. If performed at different times and without a direct connection, the right to the deduction for the new financing would be lost. The installments of the new loan shall be deductible in the proportional part attributable to the amortization of the original loan.

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