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V1567-17 19 June 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · deducción por inversión en vivienda habitual

Full mortgage tax deduction unavailable if only 50% owner of the property

A taxpayer inquired whether they could deduct the full amount of mortgage payments for their main residence despite only owning half of the property. The Directorate General for Taxes (DGT) ruled that only the proportional part corresponding to their ownership share and loan participation may be deducted.

The question raised

Possibility of applying the deduction based on the totality of the amounts allocated to amortizing 100% of the loan encumbering their primary residence, rather than solely based on the 50% corresponding to their participation in the loan and their ownership percentage of the residence.

The DGT's ruling

Each spouse under the regime of separation of assets is entitled to the deduction for investment in the primary residence based on the amounts paid for their undivided share of the property. If a joint borrower pays more than half of the installments, they may only deduct up to the percentage corresponding to their share of ownership (50% in this case). The excess paid is considered a loan or a gift to the other co-owner.

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