New tax benefits for tenants and landlords: AFIP publishes changes to rental income tax

New tax benefits for tenants and landlords: AFIP publishes changes to rental income tax

New tax compensation for tenants and landlords

A new law brings important changes in terms of tax returns in the real estate market: The possibility of asserting 10% of the annual rental costs for residential property as a tax deduction has now been officially approved by the Federal Tax Authority (AFIP). This regulation applies to both tenants and landlords.

This measure, which came into force with the adoption of the law 27,737, was announced by the publication of the general provision 5521/2024 in the Official Journal. This creates tax incentives for the renting of real estate, which also includes the supplement of Article 85 of the Income Tax Act.

The deadline for employees to submit their rental cost decades for 2023 were also extended. These must now take place by July 15, 2024 so that their employers can take this amount into account in the 2023 annual statement. It is an important way to reduce the financial burden for employees, such as Sebastián Domínguez, CEO of SDC tax consultants. So far, employees have not been able to transmit this information to their employers in the web form F. 572, which led to faulty salary bills. Now there is the possibility to report this for the annual tax return and even update monthly from 2024.

This tax deduction is also important for landlords, especially if you have other income in addition to your rental income that is subject to income tax, such as income from foreign investments.

The tenants have time until July 15 to report their rental costing declarations to their employers in order to benefit from this tax compensation. In the Official Journal, it is explicitly pointed out that the rental costs must be demonstrated by an invoice or a similar document by the landlord, as stated in the rental agreement.

It is also necessary for employees to send a copy of the rental agreement in PDF format to the service "System for registration and update income tax deductions (Siradig)-worker" to the AFIP in the first tax year in which the deduction is requested.

It is crucial that employees state their rental costs for 2023 in the web form F. 572 by July 15, 2024. Otherwise, you will avoid the tax benefits for the annual accounts for 2023. In this case, the employers must state the corresponding amount for the rental cost deductions in the "Other deductions" field of the form F. 1357.

- Nag