After the repeal of the law of rentals buying an apartment to rent, it became a business again. Currently, the rent/price ratio is increasing in the City of Buenos Aires and stands at 5.09% annually. Today, 19.6 years of rent are needed to repay the initial investment, 10.6% more than what was required a year ago, according to data from Zonaprop.
Now, it is important to know the taxes that must be paid when owning a property in order to determine if the investment is really convenient. Although since the repeal of the Rental Law there is no longer the obligation to register rental contracts, it is advisable to do so to enjoy certain tax benefits.
If the owner is a registered responsible person or monotributista, the rental is exempt from paying VAT on the property. If the owner is a monotributista, he only has to pay the tax component. The activity of real estate leasing does not generate the obligation to pay the social security fee or social work.
Meanwhile, you must pay VAT if you do not fit into any of those situations.
When must the owner pay profits
When the owner is not a monotributista and is in the general tax regime, he must pay the tax to Profits, with a rate that can range from 5% to 35%.
Both the owner and the tenant may deduct in profits 10% of the total annual amount of the rentals of real estate for residential purposes.
On the other hand, for those registered contracts, credits and debits in savings accounts or bank checking accounts that are used for operations related to the property are exempt from tax. Therefore, those who make transfers linked to real estate payments are exempt from paying the rate charged to taxpayers.
Personal assets and gross income
Homes worth up to $1,025.5 million are exempt from profit payments. As for the payment of gross income, it depends on the location of the property and the activities of the owner. If you are in CABA, the income corresponding to the owner from renting housing for up to 3 units is exempt, as long as the amount does not exceed $500,100 per month per property.
If it does not fall within the exemption and is registered in the general tax regime, the rent will be taxed at the rate of 1.5%.
For its part, regarding the real estate tax, it is generally paid by the owner, while the ABL is usually paid by the tenant.
Source: Ambito
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