If you own a rental apartment, there is exciting news for you. Starting January 1 of this year, a series of changes to housing law have taken effect, allowing you to claim meaningful deductions on your 2025 tax return. The main goal of these adjustments is to encourage the rental of primary residences and, in turn, help curb the steady rise in rental prices across the country.
What do these tax changes involve?
In broad terms, owners of rental properties can deduct 50% of their personal income tax (IRPF). Here is the intriguing part: as the rent you charge decreases, your tax benefits increase. This creates a direct incentive to offer more affordable housing to tenants without sacrificing overall profitability.
Additional bonuses tied to lower rental prices
If you choose to implement a rent reduction in areas deemed to be under pressure – a designation to be defined by the regional authorities – you may qualify for a bonus that reaches up to 70% on your tax return. This percentage applies when the tenant is a public entity or a non-profit organization and the dwelling is part of a social housing program with a monthly rent below the level set in the national housing plan.
Beyond that, if you rent a home for the first time in a charged market area, or if the tenant is aged between 18 and 35, or falls into a financially vulnerable situation or families with income below the public APIM benchmark, you can also deduct up to 70% on your tax return.
Additional gains for recent renovations
If the property has undergone renovations in the two years prior to the start of the lease, you may also receive a minimum of a 60% tax credit on the income earned from the rental. This is a strong incentive for owners who have invested in improving the quality of their property.
In summary, the housing law updates open a range of opportunities for rental property owners. Deductions that can reach up to 90% and extra bonuses for price reductions or recent renovations make investing in the rental market more attractive than ever. These changes benefit not only landlords but can also help slow the pace of rent increases, a welcome development for anyone involved in the housing market. Take advantage of these opportunities and make the 2025 tax return more favorable.