Although the deadline to file the Income Tax Return ends tomorrow, taxpayers still have the opportunity to reduce their tax burden. Hacienda highlights the existence of various deductions that are often overlooked and can be included in the draft, allowing for significant savings.
According to data from the Tax Agency, a considerable portion of taxpayers review their draft in the final weeks. For those who have not yet filed their return, there is the possibility to lower their Personal Income Tax (IRPF) by taking advantage of one of the most advantageous deductions that Hacienda keeps active.
This tax benefit, although no longer applicable to new primary residence purchases, remains valid for those who acquired their home before January 1, 2013, provided they meet the regulatory requirements. The deduction for investment in primary residence allows for 15% of the amounts allocated to the mortgage loan to be deducted, with an annual limit of 9,040 euros, which can result in a tax benefit of up to 1,356 euros per taxpayer.
The base for this deduction includes not only mortgage installments but also loan interest and certain home or life insurance policies, if their contracting was a condition imposed by the financial institution. It is important for taxpayers to check if they can include these insurances, as they do not always appear on the draft and their omission can lead to the loss of hundreds of euros.
Hacienda has recently expanded savings options. Money used to cancel a mortgage after selling a primary residence acquired before 2013 is also considered a deductible investment. This measure allows for the rectification of returns for non-prescribed tax years, up to four years back.
When a mortgage has two holders, the deduction can be doubled. Each owner can benefit from their own limit of 1,356 euros, totaling a potential combined saving of up to 2,712 euros if both meet the conditions. Additionally, in the Canary Islands, there are complementary regional deductions for certain income levels, which could further increase tax savings for some homeowners.
