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Form 100. 2019 Personal Income Tax return

9.1.1. Acquisition or refurbishment of the main residence

Only the following taxpayers will be entitled to apply the deduction for investment in a primary residence for the amounts paid in the period in question:

  1. Taxpayers who have purchased their primary residence or paid amounts for the construction of the same before 1 January 2013.

  2. Taxpayers who have paid amounts before 1 January 2013 for renovation or extension works of the main residence, provided that the aforementioned works are completed before 1 January 2017.

  3. Taxpayers who have paid amounts for the performance of works and installations to adapt the habitual residence of persons with disabilities before 1 January 2013, provided that the aforementioned works or installations are completed before 1 January 2017.

In addition, the taxpayer must have made the deduction for this property in 2012 or in previous years, unless it has not been possible practice even because the amount invested in it has not exceeded the amounts invested in previous homes, to the extent that they had been the object of the deduction and, where applicable, the amount of capital gains exempt from reinvestment.

In general, taxpayers may apply the deduction for investment in housing (state part and regional or complementary tranche, respectively) for the amounts paid in the period in question for the acquisition or renovation of the property that constitutes or is going to be the taxpayer's habitual residence.

Deduction percentages

The deduction percentage applicable to the deduction base will be in all cases 7.50% in the state tranche, and the percentage established in the respective Autonomous Community and, failing that, 100% in the autonomous tranche. 7,50 100

These percentages apply both to the amounts paid in the financial year to repay the requested loan, and to the amount paid, if applicable, in cash by the buyer.

The Autonomous Community of Catalonia has established special percentages for the autonomous tranche of the deduction.

Maximum deduction base

The maximum base will be 9,040 euros per year.

The basis of this deduction will be constituted by the amounts paid for the purchase or renovation of the property, including any expenses incurred at the expense of the acquirer and, in the case of third-party financing, the amortisation, interest, cost of the risk hedging instruments of variable interest rate on mortgage loans regulated in article nineteen of Act 36/2003 of 11 November, of economic reform measures, and other costs arising from it, such as the premiums of life and fire insurance contracts , provided that they are included in the conditions of the mortgage loans obtained for the purchase or rehabilitation of the main residence. In the event of the application of the aforementioned hedging instruments, the interest paid by the taxpayer will be reduced in the amounts obtained by the application of the aforementioned instrument (article 69,1 of the Act).

The maximum deduction base will be unique for all amounts invested in the main home (acquisition, renovation, construction, extension or housing account), except for those for works and installations for adaptation in primary residence due to disability, for which there is an independent deduction base, both of which are compatible with each other.

Cases of nullity of marriage, divorce or judicial separation

The taxpayer may continue to apply the deduction, in the event of nullity of marriage, divorce or judicial separation, for the amounts paid in the period tax for the acquisition of which your main residence was during the term of the marriage, provided that you continue to have this condition for the common children and the parent in whose company they are left. The deduction may also be made for the amounts paid, if applicable, for the purchase of the property that constitutes or is going to be incorporated into your main residence. in this case, the deduction base will be joint for the two homes of (9,040 euros per year).

 The following amounts will not be included in the base of the deduction for investment in a primary residence or deductions established by the Autonomous Community (additional provision of the Personal Income Tax Act:

  • The amounts that, due to the application of floor clauses, had been paid by the taxpayer in 2019, when before the end of the period for filing self-assessment of Personal Income Tax for that financial year, a repayment agreement is reached with the financial institution, or such a refund should be made as a result of the execution or enforcement of court rulings or arbitral awards.

  • Amounts paid in previous years by the taxpayer in application of the floor clauses subject to the refund that are directly allocated by the financial institution in the financial year, after the agreement with the affected taxpayer, judgment or arbitration decision, to reduce the principal of the loan

Investments and expenses that do not generate the right to deduction

They are not part of the deduction base:

  1. Conservation or repair costs. For these purposes, this consideration will be given:

    • Those carried out regularly in order to maintain the normal use of the material goods, such as painting, revoking or arranging of facilities.

    • Replacement of elements, such as heating, lift, security doors or others.

  2. Improvements.

  3. The purchase of parking spaces, gardens, parks, swimming pools and sports facilities and, in general, annexes or any other element that does not constitute the property itself, provided that they are purchased independently of it.

    The parking spaces acquired with them are treated as residences, with a maximum of two.

Other previous normal homes

When you purchase a main home, having received the deduction for the purchase of other habitual residences, you will not be able to deduct the purchase or the renovation of the new one, insofar as the amounts invested in it do not exceed the amounts invested in the previous ones, insofar as they have been deducted.

Exempt capital gain for reinvestment

When the disposal of a habitual residence has generated an exempt capital gain for reinvestment, the deduction base for the acquisition or renovation of the new property will be reduced by the amount of the capital gain to which the reinvestment exemption is applied.

In this case, no deduction can be made for the acquisition of the new one, while the amounts invested in it do not exceed the price of the previous one, insofar as it has been the object of deduction, as well as the exempt capital gain for reinvestment.

Checking the equity situation

The application of the deduction for investment in property will require that the verified amount of the taxpayer's assets at the end of the period of the deposit exceeds value that would be verified at the beginning of the check at least in the amount of the investments made, without including interest and other financing expenses.

For these purposes, increases or decreases in value experienced during the tax period will not be counted for the equity elements that at the end of the period continue to form part of the taxpayer's assets.

  1. Autonomous Community of Catalonia
  2. Principal Residence item
  3. Concept of home renovation