Income Tax Return in a Second Home

Apr 16, 2022 | 0 comments

The Income Tax Return campaign for the 2021 tax year began this April and will be in effect until June.

When this time of the year arrives, when we have to make the income tax declaration, we are flooded with a lot of doubts and many of them refer to the declaration when a house has been acquired.

Therefore, below we help you and tell you how to declare the purchase of a house.

How to declare the purchase of a home on the income tax return?

The first thing to know is that when a property is acquired, it must be reflected in the income tax return.

When filing your income tax return, there are certain deductions that can be made to avoid paying a lot of money to the tax authorities or even get some money back.

Among these we can find those deriving from the application for a mortgage loan, although today it is not possible to deduct this type of operation, unless the sale and purchase was signed before 2015 or the property was acquired before 2013.

However, declaring a new home is not the same as declaring a second home.

Declaring the purchase of a new home

As we have already mentioned, at the national level there are no deductions when purchasing a new home. However, there are certain autonomous regions that maintain some deductions.

For these deductions to be given you must have acquired a primary residence and it must have gone before January 2013. In these cases, a deduction of up to 15% may be made when the amount does not exceed €6,400.

You may be interested in knowing the advantages of having a second home on the beach.

Declaring the purchase of a second home

When a home is acquired and it is not destined for the habitual residence, it is considered a second home.

In order to declare the acquisition of a second home, it is necessary to take into account the use it is going to be put to, since depending on this, the home will have to be declared in one way or another.

Second Homes for Personal Use

In the event that the second home is for personal use, the State Tax Administration Agency establishes that it must be taxed as imputation of real estate income.

To calculate this income, a percentage of 2% of the cadastral value of the property will be applied when the value has not been revised in the last 10 years and without the benefit of deductions of any kind, and 1.1% in those cases in which it has been revised.

second home income tax return

Second Homes for Permanent Rental

Sometimes a property is acquired and then leased to a third party. Well, in these cases it is mandatory that such activity is taxed in the income tax. In addition, in these cases, expenses derived from the lease, such as repairs or conservation works, can be deducted in the income tax return.

You should know that, in the event that the tenant converts the property into his/her habitual residence, he/she can obtain a reduction of 60% of the income obtained from the rent.

Second homes for vacation rental

The cases in which the property is rented, but only during certain periods of the year, must be included in the income tax return. In these cases it is necessary to indicate the income that was paid as income from real estate capital together with the deductions for the expenses incurred during the time that the property remains rented.

That is to say, the days in which the property has been rented must be taxed as rent.

How to declare the sale of a house in the income tax?

The sale of a home must also be reflected in the income tax return. In these cases, 19% and 26% tax must be paid depending on the profit obtained from the operation. This can also include the expenses generated in the operation.

There are cases in which it is not necessary to tax the property sold:

  • If the seller is 65 years of age or older and sells his or her primary residence
  • If the capital obtained has been used to purchase a primary residence less than two years after the sale or if it is used to rehabilitate the primary residence but does not exceed 25% of the purchase price.


Submit a Comment