Can you access the tax refund for mortgage credit payments?

Until August 23, 2018, the tax refund for mortgage payments could be accessed. Before explaining why the refund can no longer be obtained, we tell you what this benefit was about.

What was the tax refund for mortgage credit payments?

It was a new benefit for real estate buyers who took mortgage credit.

On January 1, 2017, an amendment to the Income Tax Law began to take effect in the country: Legislative Decree No. 1258. According to the norm, some expenses – which had to be demonstrated – could be deducted from work income. For what purpose? Encourage customers to request payment vouchers, carry out payment operations through the financial system and the economy is formalized.

The SUNAT – National Superintendence of Customs and Tax Administration – had to return money to taxpayers in the following cases:

If you were a payroll or fifth category employee:

You were entitled to a deduction of 7 ITU (Unit Tax Units); and you could also provide expenses for up to 3 ITU, equivalent to S / 12,150, to be deducted from your rent.

  • If you were independent or fourth category: you retained the right for a deduction of 7 ITU (Unit Tax Units) and 20% of Gross Income; and additionally you could request deductions for up to 3 more ITU.

Among the expenses authorized to request the deduction were the interests of first home mortgage loans.

Why was this benefit eliminated?

The additional deduction sought to formalize certain items, in which no proof of payment was requested and there was little formalization. However, in the case of mortgage loans, banks are already formalized and do not generate an additional incentive to ask for invoices or receipts for fees.

On the contrary, the Ministry of Economy and Finance (MEF) reduced its tax collection for this tax refund for mortgage loan payments.

Editor’s Note: This article was originally written on March 15, 2018 and has been fully updated for accuracy.