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Practical guide to 2021 Income Tax.

For renting a property, as a result of carrying out an activity, whether self-employed or not, in a different municipality

Regulations: Art. 4.Uno.ñ), Four and Fifth Act 13/1997, of 23 December, regulating the autonomous range of Personal Income Tax and other taxes transferred, of the Valencian Community.

Amount of the deduction

10% Of the amounts paid in the tax period for the lease of a property, as a result of carrying out an activity for own or other account, in a municipality other than that in which the taxpayer previously lived. 100

In the case of married couples under the legal partnership of property, the rental costs of the main residence are attributable to both spouses, regardless of who pays them effectively or which of them appears as the owner of the invoice or contract.

Note: Only the taxpayer who resides in the rented property for their activity and for the income paid that is attributable to them is entitled to apply the deduction.

Requirements and other conditions for applying the deduction

  • That the rented property, located in the Valencian Community, gave more than 100 kilometres from the property where it lived immediately before the lease.

    Remember: To address the impact of Covid-19, effective from 1 January 2019, it was removed by the first Additional Provision of the Decree Act 1/2020, of 27 March (DOV of 30), the requirement relating to the taxpayer's obligation as lessee, of submit the corresponding self-assessment of the Capital Transfer Tax and documented legal acts derived from the lease contract of the main residence

  • The amounts paid for the lease are not remunerated by the employer.

  • The general net tax base and the taxpayer's savings, sum of the boxes [0500] and [0510] of the tax return, do not exceed the following amounts:

    1. 25,000 Euros in individual tax return.

    2. 40,000 Euros in a joint tax return.

  • The application of the deduction is conditional on the delivery of the monetary amounts derived from the legal act or business that are entitled to its application is made by credit or debit card, bank transfer, nominative cheque or deposit in accounts with credit institutions.

    The requirement of this requirement is established in the Additional Provision of Act 13/1997, of 23 December, which regulates the autonomous range of Personal Income Tax and other taxes transferred.

Quantitative limits of the deduction

  • The maximum deduction limit will be 204 euros.

  • This maximum limit of 204 euros will only be applicable to taxpayers whose sum of the general net tax base and the net tax base of the savings is less than 25,000 euros, in individual taxation, or less than 40,000 euros, in joint taxation.

  • When the sum of the general net tax base and the tax base of the taxpayer's savings is between 23,000 and 25,000 euros , in individual taxation, or between 37,000 and 40,000 euros, in joint taxation, the limits of the deduction will be as follows:

    1. In individual taxation, the result of multiplying the maximum deduction limit (204 euros) by a percentage obtained from the application of the following formula:

      100 × (1-The coefficient resulting from dividing by 4,000 the difference between the sum of the general net tax base and the taxpayer's savings and 23,000)

    2. In joint taxation, the result of multiplying the maximum deduction limit (204 euros) by a percentage obtained from the application of the following formula:

      100 × (1-The coefficient resulting from dividing by 4,000 the difference between the sum of the general net tax base and the taxpayer's savings and 37,000)

  • The limit of this deduction will be prorated by the number of days on which the lease remains in force within the year.

  • When two or more taxpayers who declare tax have the right to apply this deduction for the same property , the limit will be prorated by the same parties.

    The maximum limit of the deduction must only be applied when there is more than one person who, by filing a tax return, can apply the deduction for the same property, as it meets all the requirements required for this purpose, including the maximum amount of the net asset base, even if it does not apply effectively. Therefore, persons who do not file a tax return or those who have a net tax base higher than the required are not taken into consideration for the purposes of apportionment.

Compatibility

This deduction is compatible with the deduction mentioned above "For leasing of the main residence."

Note: Taxpayers entitled to the deduction must enter in Annex B.7 the Tax ID/Foreigner's ID of the landlord of the property and, if applicable, if they have entered a Tax ID of another country, an X will be marked in the corresponding box.