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Should you declare your home mortgage tax

Many of you are in the process of making your income tax return asking yourself questions about talking about your mortgage. We will see in which cases you can declare the interest on your home loan to reduce your taxes in 2017. All real estate purchases do not allow to take into account your financing to pay less taxes. To go further, you will also read our file on everything related to real estate for your tax return in 2017 . The case of mortgage loans for your primary or secondary residence From 2007 to 2010, it was possible to deduct a portion of the interest on borrowing your home equity loan for your principal residence from your income in order to lower your taxes. For those who did not pay taxes at the time, the tax administration even sent a check for this amount of interest. That’s what the real estate tax credit was called. This one applied over 5 years and is finished for all those who bought between 2007 and 2010. Only those who bought a new BBC housing in 2010 can still deduct interest on their mortgage since in that year there was a possibility of deductibility of 40% of interest paid over 7 years. Since 2011, this tax credit on the interest of a home loan has been replaced by different versions of the loan at zero rate . It has also been significantly improved in 2016 and 2017 and is again more advantageous. In 2017, there is no longer any possibility of reducing your taxes when you pay a mortgage for the purchase of your principal residence or a second home. Discover all the tax benefits of the main residence . The only thing that you can do in 2017 to reduce the cost of your mortgage loans subscribed for 1 to 15 years is to take advantage of borrowing rates currently very low to make a redemption of your home loan or renegotiation. You will find all our advice and information on this subject from the link above. Also receive an offer to redeem your mortgage free and without obligation. This allows you to see if it’s interesting compared to your current home loan. The case of the mortgage loan for a rental investment Unlike financing a principal residence, the interest paid on a home loan for an investment in rental real estate can be deducted from your property income according to your tax regime for them. This is why, it may be interesting to borrow more in the case of a real estate investment to take advantage of this tax benefit that you do not have for your principal residence. Real estate tax return When you collect rent on real estate that is rented, you must report that income to taxes in addition to your activity income. When you choose to report this rental income to the actual plan, you must add all gross rentals excluding charges. You can then deduct all expenses related to this accommodation . Among these, there are the interests of a mortgage. They are deducted from rents and allow you to pay less tax on your property income. In some cases, especially at the beginning of repayments and after improvement or refurbishment work, it is even possible to declare more fees than land revenue. We are talking about a property deficit that you can deduct from your other income or property income in the coming years. Declaration of rental income in the micro-land For a statement much simpler than the real regime, you can opt for the regime of micro land. This requires that you receive less than 15 000 € per year of income on all your rentals. In this case, you will not deduct the interest on the home loan, nor the other expenses and expenses of this investment. Instead, you can use a 30% flat rate abatement on your gross rents excluding charges. There is no tax advantage to borrow to finance this investment. It is even more interesting to reduce your actual costs and therefore to borrow as little as possible. To find out if this is interesting for you, look at whether you should choose the micro-land scheme for your rental income . We explain to you in detail in which cases it is interesting and in which cases it is better to privilege the real regime to pay less property taxes.

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