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V1918-25 15 October 2025 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

Interests of a mortgage for rental property can be deducted if the home is the collateral

The consultant asks whether interest on a mortgage for a rental property can be deducted if the property is used as collateral for the mortgage. The DGT responds that this is possible as long as the purpose of the funds and their repayment are proven.

The question raised

Possibility of deducting interest from a loan taken out to acquire a property that is rented out for Personal Income Tax purposes, considering that the asset securing the loan is not the rented property but the lessor's primary residence.

The DGT's ruling

To deduct loan interest from real estate capital income, it is necessary to prove the destination of the capital linked to the acquisition of the property and the justification of its repayment. The fact that the loan guarantee is the taxpayer's primary residence does not prevent deductibility, provided that evidence admitted by law is used to prove such a link.

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