Mortgage market and real estate market
Seemingly this may be an absurd topic for many readers. There was once a so-called interest relief that allowed interest to be deducted from a mortgage loan purchased on the primary market. Thus, the purchase of real estate and crediting it with mortgage money allowed to effectively reduce the tax rate. Taxpayers who took out housing loans in 2002-2006 can still deduct the interest paid on them.
Nowadays, unfortunately, in many cases private individuals do not have such a possibility. The interest relief was officially repealed on January 1, 2007. This relief would certainly help a lot – mortgage market and real estate market. The introduction of a public relief, regardless of whether the property is purchased on the secondary market or from the developer, would certainly help borrowers . Thanks to this, the real estate market in Poland would certainly develop.
Interest on the mortgage can be deducted by the entrepreneur. It is enough to document that the purchase of real estate contributes to obtaining specific income. Then the entrepreneur can deduct the interest on such a loan from the tax. It is worth remembering that loan installments are not a cost. The cost is interest paid on the loan. It is worth emphasizing that interest must be paid.
If the loan is taken by an entrepreneur whose only part has been used for the purposes of conducting business activity, then only proportionally calculated part of interest paid can be included in costs.
The cost of credit may also be fees that are associated with taking a loan .
What certainly pleases the entrepreneur is the fact that interest paid is not subject to any limits, therefore it can be included in the full amount as costs.
Can I deduct interest on the loan?
If you have doubts as to whether the interest on the loan can be tax deductible or not, it is best to ask the National Tax Information. You can get reliable information on taxes, including those related to mortgages, by calling the toll-free phone number.
What if you live abroad but pay the loan in Poland? Credit interest can be tax deductible in some countries, but it’s worth knowing that not every taxpayer has the right to do so. For example, in Norway certain conditions must be met in order to be able to deduct the interest paid from tax . This can be done by people who have taken out a loan in Norway as well as in Poland. If you have a loan from a bank, the most important condition is obtaining a tax residence in Norway and living in this country. If you have real estate in Poland and you are not entitled to a mortgage interest write-off here, you can apply for a write-off in Norway.