FinMin changes mortgage support for young people

Amendment would reduce paperwork involved in providing state assistance.

Finance Minister Peter Kažimír(Source: TASR)

The state plan to support young people to get a foot on the property ladder is to be streamlined and will involve less paperwork, Finance Minister Peter Kažimír said on August 17. The Slovak cabinet adopted an amendment to the Income Tax Act, changing the current plan on August 16 within a package of tax-related laws.

The programme aimed at supporting people under 35 years of age to take out a mortgage is to be changed to allow home buyers to be able to reduce their tax assessment base. It will thus effectively amount to a tax bonus or deduction.

Meanwhile, the eligibility conditions concerning the applicant’s age or income will remain essentially intact.

“We’re aiming to significantly simplify and reduce paperwork involved in providing state assistance to young people,” said Kažimír as cited by the TASR newswire. “The whole process involving the requirement to submit various documents to commercial banks will change into submitting a tax return. It will be much simpler.”

The support is envisioned to amount up to 50 percent of the paid interest over a particular tax period, or €400 annually at most.

Read also:Blog: Higher R&D tax allowance will not help

Other tax related amendments approved by the cabinet reduce tax secrecy, increase tax deductions for research and development expenditures from the the current 25 to 100 percent and put in place incentives for the spa sector, among other initiatives. Parliament still needs to approve the changes.

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