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V2303-19 5 September 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

60% rental income reduction possible if contract specifies individual tenant

A landlord asks whether a 60% reduction in net rental income applies when the tenant is a company providing housing for staff. The DGT states that the reduction is applicable if it can be proven that the property is intended for the residence of a specific natural person.

The question raised

Whether the 60 percent reduction of the net income provided for in Article 23.2 of the Tax Law is applicable.

The DGT's ruling

The reduction provided in Article 23.2 of the Personal Income Tax Law (LIRPF) is applicable when, even if the lessee is a legal entity, it is proven that the property is intended for the residence of certain natural persons. To this end, the terms of the contract must state that the exclusive use of the dwelling falls to the natural person identified therein. The verification of these facts is the responsibility of the Administration through the means of proof provided.

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