The deduction for joint loans is a fairly unknown deduction, but many Danes, especially in large cities, can benefit from it. It concerns apartment owners who have taken out a joint loan through their owners' association. For example, it can be for renovation of the building's facade, roof, downpipes or the like.
It is one of the deductions for expenses to banks and loan providers that is not automatically reported, like the deduction for guarantee commission. We guide you through it in this article.
In this article we will go through:
When you own an apartment, you are typically part of an owners' association, which is the collection of all apartment owners for the whole building. The owners' association handles the common decisions about the building, the yard, etc.
For large joint projects such as renovating the entire facade of the building, replacing downpipes (toilet/water pipes) or the roof of the building, it is very normal to have to take out a joint loan for the entire association to cover the costs. This means that the association goes out collectively and borrows to renovate the facade, for example. This is typically significantly cheaper than if each apartment owner had to go out and borrow money themselves.
When the association has borrowed money, it is still the owners who ultimately pay off the loan (through the owner's expenses), and therefore they can get a deduction. However, because the bank does not know who all the owners are, you have to report the deduction to SKAT yourself.
The deduction itself is the interest you have paid on the loan as the owner. You will typically receive a summary when you take out the loan, where the interest is described. Otherwise, you can contact your property manager to get this overview.
There are some other elements to be aware of with this deduction:
In TaxHelper, we help you find the deductions you're entitled to. You answer a few simple questions that take just 15 minutes to complete.
Then we report the deductions, and you get an extra DKK 2,704 back in tax. At the same time, you only pay if you get a tax saving.
If you have bought or sold a home, there are several deductions to be aware of.
The deduction for guarantee commission is one of the more unknown and overlooked deductions.