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V3115-23 1 December 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · deducción por inversión en vivienda habitual

Right to main residence tax deduction maintained if current loan is cancelled and a new one is contracted simultaneously

A taxpayer inquired whether they could continue to claim tax deductions for investment in their main residence after cancelling their current mortgage and taking out a new one with a different lender. The Directorate General for Taxes (DGT) ruled that if the cancellation and the new contract occur as a single transaction, the right to the deduction is not lost.

The question raised

Whether, after carrying out the restructuring operation through the cancellation and new contracting of a loan, the same right to deduct will be held for the amounts it amortizes or satisfies. Whether the expenses generated by the operation are deductible.

The DGT's ruling

The novation, subrogation, or substitution of a loan does not exhaust the possibilities of applying the deduction, provided that the new loan is intended to amortize the previous one. If the cancellation and the signing of the new contract are carried out simultaneously, the expenses generated by both operations are deductible. However, the proportional part of the installments corresponding to an increase in the principal intended for purposes other than the acquisition of the dwelling shall not be deductible. To maintain the right, the cancellation operation and the new contracting must occur in a single act to ensure the continuity of the financing.

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