On 8 October 2026, the AEAT published Binding Consultation V1234-26 clarifying the application of the enhanced 90% deduction for rental income (Article 23.2 LIRPF) when landlords voluntarily reduce rents by at least 5% in “stressed residential areas” (zonas tensionadas) designated by regional governments. The consultation confirms that: (1) the 5% reduction is calculated against the previous contract’s rent (or market reference index if new); (2) the 90% deduction applies to the *entire* net rental income (not just the reduced portion); (3) the reduction must be maintained for the full contract duration (min 3 years for individuals, 5 for companies); (4) the tenant’s income must not exceed 3x IPREM (€24,600/year). This measure, part of Law 12/2023 (Right to Housing), aims to incentivize affordable supply in 140 designated municipalities.
Key Takeaways
- Significant Tax Arbitrage: A landlord earning €12,000/year rent in Madrid (43% marginal rate) saves €4,644 in IRPF by accepting a €600 reduction—net gain of €4,044 after rent loss.
- Contractual Formalization: The reduction must be documented in a new contract or addendum registered with the regional housing agency; verbal agreements or private emails are insufficient for AEAT verification.
- Regional Map Dependency: Only 140 municipalities (covering 65% of rental stock) have approved “stressed area” designations; landlords in non-designated areas cannot access the 90% deduction regardless of voluntary reductions.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement