Doctrine by topic · DGT Observatory

Loan Repayment: DGT doctrinal evolution

How the DGT's position on this topic has evolved, and the rulings it rests on.

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How the DGT's position has evolved

Settled doctrine High confidence 57 rulings · 2018–2026

Current position

The novation, subrogation, or substitution of a loan does not exhaust the right to deduction if the new credit is intended to repay the previous one. To maintain this right, the cancellation of the original loan and the signing of the new contract must occur simultaneously or in a single act. The deduction of installments and appraisal, notary, and registry expenses is permitted, excluding the proportional part of the principal intended for other purposes.

The DGT's position remains constant regarding the deductibility of interest following a novation or substitution, provided that the purpose of repaying the original loan is maintained. The evolution shows greater technical precision by integrating the deductibility of associated expenses (appraisal, notary, and registry) when the operation is simultaneous, as observed in the rulings of 2023 and 2026.

Turning points

  1. V1603-23

    Establishes the need for the cancellation of the original loan and the signing of the new contract to occur in a single act or simultaneously to avoid losing the right to deduction.

  2. V5325-26

    Specifies that appraisal, notary, and registry expenses derived from the loan substitution are also deductible if the operation is simultaneous.

Analysis based on 50 of 57 rulings with a stated position. Updated 18 September 2026.

Rulings on this topic

24
V5325-26 28 Jul 2026

Right to deduction for home ownership investment maintained on loan replacement

SG de Impuestos sobre la Renta de las Personas Físicas
deducción por inversión en vivienda habitualrégimen transitorioamortización de préstamosustitución de préstamogastos de cancelación LIRPF — Ley 35/2006 del IRPF art. 68.1LIRPF — Ley 35/2006 del IRPF art. 70.1
Affects CompanyExpat · Non-residentIndividual
V1238-26 22 May 2026

Deductions for home ownership expenses applicable only during habitual residence

SG de Impuestos sobre la Renta de las Personas Físicas
deducción por inversión en vivienda habitualrégimen transitorioresidencia habitualamortización de préstamopatrimonio LIRPF — Ley 35/2006 del IRPF art. 68.1.1LIRPF — Ley 35/2006 del IRPF art. 70.1
Affects CompanyExpat · Non-residentIndividual
V0521-25 28 Mar 2025

Right to deduction for home investment maintained on loan replacement

SG de Impuestos sobre la Renta de las Personas Físicas
deducción por inversión en vivienda habitualrégimen transitorioamortización de préstamoampliación de principalsustitución de préstamo LIRPF — Ley 35/2006 del IRPF art. 68.1.1ºLIRPF — Ley 35/2006 del IRPF art. 70.1
Affects CompanyExpat · Non-residentIndividual
V0727-24 16 Apr 2024

Right to tax deduction for main residence investment maintained if current mortgage is cancelled and a new one is taken out simultaneously

SG de Impuestos sobre la Renta de las Personas Físicas
deducción por inversión en vivienda habitualrégimen transitorioamortización de préstamosustitución de préstamocancelación registral hipotecaria LIRPF — Ley 35/2006 del IRPF art. 68.1.1ºLIRPF — Ley 35/2006 del IRPF art. 70.1
Affects CompanyExpat · Non-residentIndividual
V2837-23 19 Oct 2023

The right to the deduction for investment in primary residence is maintained if the current loan is cancelled and a new one is contracted simultaneously

SG de Impuestos sobre la Renta de las Personas Físicas
deducción por inversión en vivienda habitualrégimen transitorioamortización de préstamosustitución de préstamogastos de cancelación LIRPF — Ley 35/2006 del IRPF art. 68.1.1ºLIRPF — Ley 35/2006 del IRPF art. 70.1
Affects CompanyExpat · Non-residentIndividual

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