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Registration and receipt of a tax refund when buying an apartment on a mortgage

The law provides for the possibility of returning part of the money spent on the purchase of real estate through a tax deduction. The Tax Code establishes several types of refunds, which represent a reduction in the base for calculating the tax. By purchasing real estate, in accordance with Art. 220 Tax Code, buyers have the right to expect to receive a property return. Refunds are made at the expense of the personal income tax paid by the owner of the property earlier. This right also applies to tax refunds when buying an apartment on a mortgage.

Since the value of the personal income tax is 13 percent, when applying, net of deduction, buyers can get back funds in the same amount. The procedure for how to return 13 percent from the purchase of an apartment has its own nuances and restrictions regarding the categories of persons entitled to return part of the funds, as well as regarding the amount of the refund.

Borrowers who have official income and have used borrowed funds to purchase real estate can also receive a refund of 13 percent on mortgage interest by submitting a set of documents to the state authorities.

Reimbursement methods

Income tax refunds when buying an apartment can be received by transferring once a year or monthly:

  • The entire amount to be reimbursed for the year is transferred once to the borrower's card.
  • The payment is made monthly by withholding tax through the employer.

When making payments by monthly transfer, the employer does not pay the borrower, withholding tax payments on salaries until the amount transferred is equal to the amount returned for the year.

Registration procedure

The right of filing can be exercised by the borrower within the next three years after the conclusion of the transaction.

Repayment of interest on a mortgage is a simple procedure, consisting of the following steps:

  1. Collection of documents and preparation of copies.
  2. Contacting the tax office at the place of registration.
  3. Consideration by an employee of the fiscal authority of an application for a property deduction.
  4. After the approval of the deduction, the applicant provides the details for which the state will make the refund.

Submission of documents

In order to return the interest on the mortgage, you must prepare a package of documents.

Every year, the owner of the apartment prepares and submits to the local branch of the fiscal authority the following list of documents for a refund of 13 percent:

  1. Original title deed and photocopy;
  2. Purchase and sale agreement of housing with a photocopy;
  3. Payment receipts, other documents confirming the repayment of the mortgage;
  4. Bank statement with a loan payment schedule;
  5. Information about wages, income tax declaration;
  6. Mortgage agreement;
  7. Original civil passport with a photocopy of all pages.

When submitting documents for the return of personal income tax when buying an apartment on a mortgage, you should worry in advance about the presence of photocopies and originals for verifying the data.

In some cases, in the process of repaying a loan, the borrower assigns his rights to another person. In this case, the owner of the apartment provides information about the changes that have occurred.

A mortgage taken in foreign currency will require recalculation by bank employees in the ruble equivalent at the exchange rate of the Central Bank.

Features of the mortgage deduction

Despite the similarity of the procedure for obtaining a property deduction, the refund of 13 percent from the purchase of an apartment on a mortgage has its own characteristics:

  1. The period of validity of compensation for property deduction covers the entire term of the loan.
  2. Since 2017, when registering refinancing, the credit holder can present an interest rate for refund.
  3. In the case of a mortgage with a co-borrower, you need to be prepared that the tax office may refuse to pay due to the fact that the mortgage account was opened for another person.
  4. The printed receipt of repayment of mortgage payments through an ATM does not reflect the name of the payer, which can lead to difficulties in coordinating the procedure with the tax office.

Calculating mortgage deduction

Costs taken into account

Expenses subject to income tax reimbursement may include the following cost items:

  1. The cost of an apartment or other housing.
  2. Purchase of building materials for finishing works (if purchased without finishing).
  3. Costs for drawing up a project or estimate.
  4. Remuneration for construction workers or finishing specialists.
  5. Organization of engineering systems.
  6. The cost of completing the construction of an unfinished house.

Only those expenses incurred personally by the home purchaser, excluding maternity capital, government subsidies, and other social benefits, are subject to reimbursement.

Calculating the deduction

There is a limit on the amount to be paid. An individual who has bought an apartment or house has the right to return the 13 percent deduction from tax transfers in full if the estimated cost does not exceed 2 million rubles, i.e. within 260 thousand rubles.

If the income of an individual is not large enough, a smaller amount will be provided for refund.

Deduction for housing in common ownership

There are certain rules for calculating payments depending on the form of the acquired property:

  1. For an apartment that is in shared ownership of family members, the amount of compensation is distributed in proportion to the shared ownership. The law does not allow one of the equity holders to waive the due share of the tax deduction in favor of another owner.
  2. In proportion to the size of the ownership, the amounts for the joint ownership will be listed, however, at the discretion of the buyers, the payment may be transferred to one of the owners.

Restrictions

Not all categories of citizens. The law does not apply to persons who do not pay taxes on income:

  • Citizens with the status of "unemployed".
  • Beneficiary citizens.
  • Entrepreneurs.
  • Pensioners receiving a pension for more than three years before the purchase of a home.
  • Buyers who used government subsidies, maternity capital, etc. for the transaction.
  • Owners of apartments, premises obtained as a result of privatization.
  • Buyers who bought real estate from close relatives.
  • Property owners who have already taken advantage of the tax deduction before 2014.

To be eligible for a tax refund, you must meet the following requirements:

  1. Official employment;
  2. Transfer of personal income tax to the state budget by the employer.

Number of hits minus

According to federal law, buyers who issued a deduction for a transaction before 2014. cannot receive 13 percent again on another purchased property.

For those who bought housing later than 01.01.2014, different rules apply: the refund is limited to the maximum amount, i.e. 260 thousand rubles. For example, if a buyer acquired property and issued a deduction for housing worth 1.3 million rubles in the period from January 2014, he can claim a tax refund upon making a new purchase of property within the amount of 0.7 million rubles.

Any citizen who has bought a mortgage apartment can count on a property deduction if he is a taxpayer of personal income tax and regularly makes monthly payments on the loan. There are restrictions on the frequency of registration of the deduction, the category of the acquired real estate and the funds used to acquire the real estate. Receiving reimbursement can significantly ease the financial burden of a buyer who owns a mortgage apartment or house.

Attention! Due to the latest changes in legislation, the legal information in this article may become out of date!

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