when the tax deduction corresponding to the VAT paid is due

The Danish Tax Agency has published the answer to order no. 261 of 11 May 2022 on tax relief for the purchase of residential house of young people.

Article 64 of the Decree-Law of 25 May 2021, n. 73 (entitled “Measures in favor of the purchase of housing and in connection with the prevention and combating of discomfort among young people”), as amended by Article 1 of the Law of 30 December 2021, no. 234 stipulates that the translation deeds for consideration for the property regarding ‘first home’ for habitationwith the exception of those of cadastral categories A1, A8 and A9, as defined in note IIbis of Article 1, in the first part of the tariff, annexed to the consolidated text of the provisions on registration tax, approved by decree of the President of the Republic of 26 April 1986, n 131, and the related translational or constituent deeds of expropriation, right of use, use and dwelling are exempt from registration tax and from mortgage and cadastral taxes, if they are provided for the benefit of subjects who have not yet completed. thirty-six years old in the year in which the deed is certified and which has an indicator value for the corresponding financial situation not exceeding 40,000 euros per year.

For those in para. 6 mentioned acts concerning VAT-liable transfers are attributed to the buyers who have not yet completed thirty-six year of age in the year in which the deed is provided for a tax deduction corresponding to the value added tax paid in connection with the purchase.

The tax deduction can be reduced from registration fees, mortgage, registration, inheritance and donations due on deeds and complaints made after the date of acquisition of the credit, or can be used to reduce the income tax for persons to be paid on the basis of the declaration to be submitted after the date of purchase; it may also be used for compensation under Decree-Law of 9 July 1997, No 241.

In any case, the tax deduction does not give rise to a refund.

The aforementioned provisions apply to deeds stipulated in the period between the date of entry into force of the Decree, 26 May 2021 and 31 December 2022.

In case of lack of conditions and requirements to take advantage of concessions o for the forfeiture of the said concessions, for the recovery of taxes due and for the setting of fines and interest, the relative provisions set out in note II bis of Article 1 of the tariff, first part, annexed to the consolidated text of the provisions relating to the registration tax; , approved by decree of the President of the Republic of 26 April 1986, No. 131 and Article 20 of the Decree of the President of the Republic of 29 September 1973, No. 601.

Basically introduced the legislature advantageous in the question of indirect taxes for the purchase of the house for the purpose of promoting young people’s housing autonomy, applicable in the hypothesis of purchase of “first home“, referred to in note II-bis of Article 1 of the Tariff, Part 1, attached to Presidential Decree No 131 of 26 April 1986, when the following additional requirements are met:

requirements “register“, or the buyer must not yet be thirty-six years of age in the year in which the deed is signed;

“economic” requirement, the buyer must have an “Equivalent Economic Situation Indicator” of a maximum of 40,000 euros per year.

In particular, Article 64 provides for the exemption from the payment of registration, mortgage and cadastral fees and, in the case of a purchase subject to VAT, the recognition of a tax deduction of an amount corresponding to the tax paid in connection with the purchase. Furthermore, the exemption from the compensation tax for loans granted for the purchase, construction and renovation of residential properties is envisaged upon the entry into force of the same conditions.

The tax deduction is due in scope no more than 4 per cent. PCS. 7 of the aforementioned Article 64 provides for the possibility of tax deduction for VAT-liable deeds or deeds for the transfer of ownership of “first dwellings” of residence.

This is also confirmed in the explanatory circular of 14 October 2021, n. 12 / E, section 3.1., In which it was clarified that it is up to the buyer when the exemption scheme mentioned in § 10, no. 8-bis, of the President Decree of 26 October 1972, No. 633, a tax deduction of an amount equal to the value added tax paid in connection with the purchase, applied at a rate in target of 4 per cent.

By the editors

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