Renting an apartment to a young person under the age of 35 is exempt from 70% of income tax

The Income tax deduction for renting a permanent residence it can reach 70% in cases of inclusion in the market of new real estate in areas of stressed market are rented to young people from 18 to 35 years old, according to the housing law that the plenary session of Congress plans to approve this Thursday.

In the text, current deduction of 60% of personal income tax for the net rental income of the usual residence it becomes 50%, but changes to 90% in stressed areas.

The the discount will be 90% when the renter lowers the price by more than 5% rents in a new contract for a house located in a stressed area, compared to the price of the previous contract, after the annual update is applied.

For new apartment rent for young people between 18 and 35 years old is 70% discount, the same as when the tenant is a public administration or a non-profit person that assigns an apartment for social rent with monthly incomes lower than those determined by the support program for rent of the state housing plan or accommodation for people in a social situation.

In the case of homes that have been renovated in the previous two years, the deduction will be 60%. The final provision of the law which includes tax reliefs applied in income tax for renting real estate intended for housing points out that this “improvement” of the income tax regulation aims to “encourage the rental of permanent residence at affordable prices”.

These reductions, which will apply as long as the requirements are still met, will not apply to those contracts that do not comply with section 6 of article 17 of the Law on Urban Leasing, i.e. which required an advance payment of more than one monthly rent..

As stated in the law, the new modulation will apply from January 1, 2024.