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V2436-24 3 December 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos de capital inmobiliario

Interest on loans for apartments leased for commercial use may be tax-deductible

A taxpayer inquired whether interest on a loan taken to purchase an apartment, which is subsequently leased to a company for commercial exploitation, is deductible. The Directorate General for Taxes (DGT) ruled that such interest is deductible as a necessary expense for generating real estate capital income.

The question raised

A request is made to determine whether the interest on the loan obtained for the purchase of the apartment, which is transferred to the company for its exploitation, is deductible for the purposes of determining Personal Income Tax. It is also requested that instructions be provided on how to prove the allocation of the loan to the purchase of the real estate property.

The DGT's ruling

Interest on third-party capital invested in the acquisition of the real estate property is deductible for the purpose of determining the net yield of real estate capital income. The allocation of the loan to the purchase must be substantiated by any means of proof admitted under law. The competence to assess such means of proof lies with the Management and Inspection bodies of the AEAT.

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