The tax Council of Ministers has approved today, the proposal of the Ministry of Ecological Transition and the Demographic Challenge; Treasury and Public Function; Transport, Mobility and the Urban Agenda; Work and Social Economy; Agriculture, Fisheries and Food, and Universities, a Royal Decree-Law approving measures to reinforce the protection of energy consumers and to contribute to the reduction of natural gas consumption in the application of the “Plan + security for your energy (+SE)”, as well as measures regarding the remuneration of personnel at the service of the public sector and the protection of eventual agricultural workers affected by the drought.
One of the measures contemplated in this Royal Decree-Law is the extension of the temporary validity of the deductions of the Personal Income Tax (IRPF) for works to improve energy efficiency in homes that are applied on the Amounts invested in rehabilitation works that contribute to achieving certain improvements in the energy efficiency of the habitual residence and in residential buildings, accredited through an energy efficiency certificate.
The Government extends tax
The measure is financed from the Recovery and Resilience Mechanism (MRR) approved by the European Union and is part of the investment C02.I01 of the PRTR, “Rehabilitation program for economic and social recovery in residential environments”, endowed with 3,420 million euros, of which 450 million will initially be used to finance tax relief incentives
In particular, the period of application of the following three deductions, which were approved through Royal Decree-Law 19/2021, of October 5, on urgent measures to promote building rehabilitation activity in the context of the PRTR ( currently, Law 10/2022, of June 14):
- 20% deduction for actions that reduce the demand for heating and cooling in habitual residence by 7% . Its application period ended on December 31, 2022 and extends until December 31, 2023 , and it must be the taxpayer’s habitual residence, or that is intended or will be used for rent as a habitual residence, and people may apply. physical that carry out rehabilitation and improvement actions in which a reduction of at least 7 percent is obtained in the demand for heating and cooling, according to the energy efficiency certificate of the home. The deduction percentage is 20% of the amounts paid for the works carried out in the application period, up to a maximum of 5,000 euros per home.
- 40% deduction for actions that reduce the consumption of non-renewable primary energy by 30%, or improve the energy rating by reaching the letters “A” or “B” in habitual residence . Its application period ended on December 31, 2022 and runs until December 31, 2023, and it must also be the taxpayer’s habitual residence, or that is intended or will be used for rent as a habitual residence, and natural persons who carry out rehabilitation or improvement actions that reduce at least 30 percent of the Consumption of non-renewable primary energy, creditable through the home’s energy efficiency certificate, or improvement of the home’s energy rating to obtain an “A” or “B” energy class, on the same rating scale. The deduction percentage is 40% of the amounts paid for the works carried out in the application period, up to a maximum of 7,500 euros per home.
- 60% deduction for actions that reduce the consumption of non-renewable primary energy by 30%, or improve the rating by reaching the letters “A” or “B” in residential buildings . Its application period ended on December 31, 2023 and runs until December 31, 2024, and must be improvement actions that affect the whole of the building. Natural persons in whose building improvement or rehabilitation works have been carried out in which a reduction of at least 30 percent of the consumption of non-renewable primary energy, creditable through the building’s energy efficiency certificate, or improvement of the building’s energy rating to obtain an “A” or “B” energy class, on the same rating scale. The deduction percentage is 60% of the amounts paid for the works carried out in the application period, up to a maximum of 15,000 euros per home.
In this way, with this extension, key instruments continue to be established to ensure compliance with the objectives of the Ministry in favor of residential rehabilitation, at the service of the exercise of constitutional law, adding to the set of actions already underway, in the context of the opportunity to apply the funds from the Recovery, Transformation and Resilience Plan.
New tax relief increases
Royal Decree-Law 17/2020, of May 5, has been published in the Official State Gazette, approving support measures for the cultural sector and of a tax nature to deal with the economic and social impact of COVID-2019. This Royal Decree also includes some measures to increase tax deductions in personal income tax.
By virtue of the second final provision of this Royal Decree-Law, article 19 of Law 49/2002 is modified, including an increase in the percentages of the deduction for donations to beneficiary entities of patronage for natural persons residing in Spain ( ie: personal income taxpayers).