Deduction for rental of the residence: Transitional scheme
Regulations: Transitional provision fifteenth Law Personal Income Tax ; Articles 67.1, 68.7 and 77.1 Law Personal Income Tax , in its wording in force as of December 31, 2020
Law 26/2014, of November 27, which modifies Law 35/2006, of November 28, on Personal Income Tax, the consolidated text of the Income Tax Law of no Residents, approved by Royal Legislative Decree 5/2004, of March 5, and other tax regulations ( BOE of the 28th) has abolished, with effect from January 1, 2015, the Deduction for rental of the residence.
However, for taxpayers who had previously been deducting rent for rent, a transitional regime is introduced that allows them to continue enjoying the deduction under the same terms and with the same conditions that existed on December 31, 2014.
To whom does the transitional regime apply?
Taxpayers who meet the following conditions may apply the deduction for renting their habitual residence:
That they had entered into a lease contract prior to January 1, 2015 by which they had paid, prior to said date, amounts for the rent of their habitual residence.
The taxpayer will have the right to the deduction for renting a habitual residence during the tax periods in which, as a result of its extension, the validity of the rental contract entered into prior to January 1, 2015 is maintained.
However, the signing of a new lease contract for the same habitual residence at the end of the initial contract or to modify the agreed conditions, among others, the rental price, is considered, for the exclusive purposes of the application of the transitional regime , as a continuation of the previous one, so it will not prevent the right to continue practicing the deduction.
Likewise, for the exclusive purposes of the application of the transitional regime, the signing of a new lease contract will be considered as a continuation of the previous one in the cases of change of landlord due to transfer of the home, such as replacement of the old landlord by his heir due to the death of the first, purchase, sale or dation in payment.
That they would have been entitled to the deduction for renting the habitual residence in relation to the amounts paid for the rental of said residence in a tax period accrued prior to January 1, 2015.
The transitional regime will apply if the contract was concluded prior to 2015 even though in 2014 and/or previous years the deduction for renting a habitual residence was not applied despite having met the requirements for its application.
How the deduction is applied in the transitional regime
The fifteenth transitional provision of the Personal Income Tax Law maintains, for taxpayers who are entitled to the transitional regime, the application of the regulation contained in articles 67.1, 68.7 and 77.1 of the Tax Law , in its wording in force as of December 31, 2014.
Amount and requirements for applying the deduction
Without prejudice to the deduction for renting a habitual residence that, if applicable, each Autonomous Community had approved for the 2021 financial year, taxpayers may deduct 10.05 percent of the amounts paid in the tax period for the rental of your habitual residence, as long as your tax base is less than 24,107.20 euros per year.
The taxpayer's tax base is formed by the sum of the amounts entered in boxes  (general tax base) and  (savings tax base) of the declaration.
Maximum base of the deduction
The maximum base of this deduction is:
9,040 euros per year , when the tax base is equal to or less than 17,707.20 euros per year.
9,040 – [1.4125 x ( BI – 17,707.20)] , when the tax base is between 17,707.20 and 24,107.20 euros annually.
BI being the taxpayer's tax base. That is, the sum of the amounts reflected in boxes  (general tax base) and  (savings tax base) of the declaration.
Note: Taxpayers entitled to the application of the transitional regime whose tax base, in the terms previously mentioned, is equal to or greater than 24,107.20 euros per year, in individual taxation or in joint taxation, will not be able to apply this deduction.
Don MAV He has rented his habitual residence since 2006 and has been deducting this concept in Personal Income Tax . In fiscal year 2021, the lessor has been paid the amount of 6,900 euros per year for this concept.
The general tax base of the taxpayer in fiscal year 2021, who pays taxes individually, has amounted to 21,500 euros and the tax base of savings to 600 euros.
Determine the amount of the deduction for renting the primary residence in fiscal year 2021.Solution :
Amounts paid for the rent of the habitual residence = 6,900
Maximum base of the deduction :
As your tax base is greater than 17,707.20 euros, the maximum deduction base will be determined by subtracting from 9,040 euros the result of multiplying the difference between the tax base and 17,707.20 euros per year by 1.4125.
That is to say: 9,040 – [1.4125 x (22,100 – 17,707.20)] = 2,835.17
Deduction amount: (2,835.17 x 10.05%) = 284.93
The amount of the deduction thus determined will be recorded in boxes  and  of the declaration, entering in each of them 50 percent of the total deduction.
That is, 284.93 x 50% = 142.46.