How to Claim the Mortgage Tax Deduction in Year-End Adjustment
The mortgage tax deduction requires a final tax return in year 1, but from year 2 onward it can be handled entirely through year-end adjustment. Learn how to read the balance certificate and fill in the form.
【What is the mortgage tax deduction?】
If you purchased, built, or significantly renovated a home using a mortgage, you can deduct 0.7% of your year-end loan balance from income tax (for homes moved into from fiscal year 2022 onward).
【Year 1 vs. year 2 and beyond】
Year 1: A final tax return is required (filed with the tax office)
Year 2+: Handled entirely through year-end adjustment (submit forms to payroll department)
【Documents required from year 2 onward】
① Mortgage tax deduction declaration form (mailed by the tax office)
② "Year-end outstanding loan balance certificate" from your financial institution
【Reading the balance certificate】
Shows the loan balance as of year-end. That amount × 0.7% is roughly your maximum deduction (actual calculation may vary based on tax liability and balance).
【Where to submit the form】
Submit directly to your company's payroll/year-end adjustment team. The internal deadline is usually late November to early December.
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