Legislative measures, growth in demand, increased insecurity. The number of rental properties is falling, and there are many reasons for this. Renting is a business like any other, and landlords need to have certain guarantees, protections, even benefits.

In the midst of this challenging landscape, it is essential to recognize the benefits offered by the tax system for rental property owners. The ability to deduct certain expenses associated with renting not only provides an additional financial incentive for landlords, but can also help offset some of the risks and costs involved in managing a rental property.

The ability to deduct expenses such as municipal taxes, mortgage interest and lease origination costs can make a significant difference in the overall return on the real estate investment. These deductions not only help reduce the tax burden on landlords, but also provide them with a greater degree of financial security and stability in an increasingly volatile market.

What expenses can you deduct from your rental property?

By renting out your home, you not only earn passive income, but you can also take advantage of a number of tax benefits by deducting various rental-related expenses. Deducting rent not only helps you optimize your finances, but can also significantly reduce your tax burden. Here are six expenses you can deduct to make the most of this opportunity.

Maintaining and repairing your home

Keeping your property in good condition is essential to ensure the satisfaction of your tenants. But that’s not all… These expenses, associated with the maintenance and repair of your rental property, can also be tax deductible. You can recover part of these costs through deductions on your tax return.

From plumbing repairs to electrical work and painting. All of these expenses, intended to maintain the habitability and functionality of the property, can be considered tax deductible. Even general maintenance, such as regular cleaning and landscaping, can be included in this category.

In addition to maintenance and repair expenses, the cost of home insurance may also be tax deductible. This insurance is essential to protect your investment from damage, theft or legal liability, and its inclusion as a tax-deductible expense can provide you with greater financial peace of mind.

To take advantage of these tax deduction opportunities, be sure to keep a detailed record of all expenses related to the upkeep and repair of your home, and consult with a tax professional to make the most of these deductions on your tax return.

Deduct the interest on your mortgage

One of the biggest expenses associated with owning a rental property is undoubtedly the mortgage payment. However, what many homeowners don’t realize is that mortgage interest paid may be tax deductible.

Mortgage interest is often a significant part of a monthly mortgage payment, especially in the early years of the loan when most of the payment goes to interest. The ability to deduct this interest can represent a significant tax savings for rental homeowners, as it allows them to reduce their taxable income and, consequently, pay less tax.

To take advantage of this deduction, it is essential to keep a detailed record of the interest paid during the year. This may include monthly bank statements, pay stubs or any other relevant documentation that shows mortgage interest paid. By having this information available when you file your tax return, you can ensure you claim all the deductions you are entitled to and maximize your tax savings.

What about community expenses?

If your rental property is part of a community of owners, such as an apartment building or housing development, you’ll likely face a number of expenses associated with the maintenance and operation of the common areas. Fortunately, many of these expenses are also tax deductible.

Some of the expenses you can deduct include:

• Building maintenance costs, which can range from elevator repairs to exterior painting.
• Community services, such as cleaning of common areas, building security and maintenance of gardens and green areas.
• Community insurance, essential to protect the property against possible damages or legal liabilities.

The amortization of real estate

When you own a rental property, it is important to consider real estate depreciation as part of your tax relief strategy. Depreciation refers to the gradual depreciation of the property’s value over time due to wear and tear, use and other factors.

If you want to know the real estate depreciation, you have to calculated as a percentage of the assessed value of the home and associated personal property. For example, you can deduct up to 3% of the cadastral value of the property as part of the depreciation. In addition, if you rent the property furnished, you can also deduct an additional percentage for the depreciation of the personal property, which is generally around 10% for each year of rental that has elapsed.

Deduct rental contract expenses

When formalizing the rental contract for your home, you are likely to incur a number of expenses associated with this process. Among the expenses that you can deduct are the fees paid to real estate agencies for the intermediation in the search of tenants, as well as the legal fees associated with the drafting and review of the lease. In addition, any other costs related to the negotiation and formalization of the contract, such as notary or land registry fees, can also be included as a tax-deductible expense.

By including these expenses on your tax return, you have the opportunity to reduce your taxable income and, consequently, pay less tax. This allows you to maximize your tax savings and optimize your finances as a rental property owner. However, it is important to keep a detailed record of all these expenses and make sure you comply with all local tax regulations to take full advantage of this tax relief opportunity.

Making the most of your rental property

From municipal taxes and fees to maintenance and repair costs, mortgage interest and lease costs. Each deduction provides significant financial relief to rental homeowners. Take full advantage of these tax relief opportunities and keep accurate records of all expenses related to your rental property.

Tax laws may vary by location and individual circumstances, so it is advisable to consult with a tax professional for personalized advice. With careful planning and a solid understanding of available deductions, you can optimize your finances and take full advantage of the benefits of owning a rental property.