Rental income What is it and how to declare it?

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If you own a property or are thinking about buying to rent a home, it is very important that you know what rental income is and how to include it in your income tax return. In today's article we give you all the information about it.


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What is rental income?
Rental income is the benefits that the owner of a property obtains by renting it for a period of time to a tenant. If you are currently renting your home, you must include this type of income in your Income Tax return, since the Tax Agency could sanction you if you do not declare it.


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How to declare rental income?
To declare the benefits you receive from your renter, you must include them in box 0102 of the income tax return.

To declare your rental in the Income Tax you have to calculate all the benefits you have Chinese Overseas America Number Data obtained throughout the year from renting the property and the expenses you have had. In this way, you will have to add all the benefits and subtract the expenses you had from them. From the figure you obtain you will be able to deduct 60% if the property is rented as a home, but you will not be able to deduct anything if said property is rented as a business.

From these profits you must subtract a series of expenses that occur when you rent a property and that will make you deduct the rent on your property.

Rental taxes for the owner
One of the most frequent questions that arise for landlords when renting their property is what amounts the owner must pay. The lessor is only obliged to pay the Property Tax (IBI) in addition to the Personal Income Tax (IRPF).

If your property is rented to someone who uses it as a business, you must pay the Value Added Tax (VAT) in addition to the IBI, since it is a rental for commercial purposes.

Remember that water rates, garbage rates and community expenses are also borne by the landlord and must be included in box 0115 of the Income Tax, although if the tenant is responsible for any of these expenses, the landlord does not You may include them in your income tax return.

Rental expenses: Which ones can you deduct?
As we mentioned previously, there are a series of expenses that are deductible in the Income Tax return and that, therefore, can include:



Property expenses. You can declare expenses related to the purchase of furniture or household items. You must put these in box 0117 of the Income Tax.
Formalization expenses. Those that are related to the formalization of the rental contract or other activities to establish the leasing activity. Include them in box 0110.
Legal defense expenses. In case you have had non-payment problems with your tenant or have carried out legal procedures. You must indicate them in box 0111.
Comprehensive rental management expenses. These refer to the amount paid to a real estate agency to find a tenant for your apartment, manage the collections and incidents of renting your property, etc. You must mark them in box 0112.
Home insurance. Other expenses that you can include are those related to insurance associated with the rented property, for example, home insurance, civil liability insurance, non-payment of rent insurance , etc. It is very important to indicate them in box 0114.
Repairs for renting the home. Related to those expenses that are generated by repairing aspects of the home. Keep in mind that you cannot add all the repairs that are made but only those repairs so that the property can be habitable, for example, repairs to heating, humidity, etc. Remember to put them in box 0107.