Personal income tax incurred due to mortgage loans can be reduced or reduced by 1,000 yuan per month, and the reduction period shall not exceed 240 months.

Personal income tax is the general term for the legal norms that regulate the social relations that occur between tax collection authorities and natural persons (residents and non-residents) in the collection and management of personal income tax.

Personal income tax payers include both resident taxpayers and non-resident taxpayers. Resident taxpayers have full tax obligations and must pay personal income tax on all their income from sources within China and abroad; non-resident taxpayers only pay personal income tax on their income from sources within China.

Personal income tax is a type of income tax levied by the state on the income of its own citizens, individuals living in the country, and the income of overseas individuals derived from the country. In some countries, personal income tax is the main tax, accounting for a large proportion of fiscal revenue and having a large impact on the economy.

According to regulations, six types of expenses, including children’s education expenses, medical treatment for serious illness, mortgage interest, house rent, supporting the elderly, and continuing education, can participate in special additional deductions. After deduction, personal mortgage interest can be deducted from personal income tax. If there is any remaining balance after final calculation, a sum of cash can be directly refunded to you.

Legal Basis

"Interim Measures for Special Additional Deductions for Personal Income Tax"

Article 14 The taxpayer himself or his spouse uses a commercial bank alone or together Or the housing provident fund personal housing loan is used to purchase a house in China for myself or his spouse. The interest expense on the first housing loan shall be deducted at a standard fixed amount of 1,000 yuan per month in the year in which the loan interest is actually incurred. The maximum deduction period shall not exceed 240 months. months. Taxpayers can only enjoy a one-time deduction for interest on their first home loan.

The term “first-home loan” as mentioned in these Measures refers to a home loan that enjoys the first-home loan interest rate for purchasing a home.

Article 15: Upon agreement between the husband and wife, one of the spouses can choose to make the deduction. The specific deduction method cannot be changed within a tax year.

For the first housing loan that the couple purchased separately before marriage, the loan interest expenses can be deducted by the purchaser at 100% of the deduction standard for one of the houses purchased after marriage. The husband and wife each deduct 50% of the deduction standard for the houses they purchased respectively. The specific deduction method cannot be changed within a tax year.

Article 16: Taxpayers shall retain housing loan contracts and loan repayment vouchers for future reference.