Materialise your property projects

Transcription

Materialise your
property projects
All you need to know about mortgage
loans.
ing.be/home
2015 Mortgage loan | 1
Introduction
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Mortgage loans in concrete terms
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The various forms of mortgage loans
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Interest rate variability packages
Fixed interest rate packages
Variable interest rate packages
Repayment method packages
Fixed monthly repayment mortgage loans
Fixed capital repayment mortgage loans
Specific packages
Bullet loans: mortgage loans without interim capital repayments
Bridge loans
Collateral: your loan guarantees
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The charges
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Dossier fees
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Survey charges
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Deed of purchase charges
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Charges for a mortgage deed or notarised mandate
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Re-investment penalty 10
Insurance
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Outstanding balance insurance
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Fire insurance
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Mortgage loan taxation Foreword
Regional tax benefits: home bonus
Definition: “own and only” home
Home in the European Economic Area
What are the tax advantages?
Conditions relating to the loan contract
Conditions relating to the outstanding balance insurance contract
Regional tax benefits: long-term savings tax reduction
Regional tax benefits: tax reduction for interest
Non-only home: federal authority
Federal tax benefits: long-term savings tax reduction
Federal tax benefits: ordinary interest deduction
Practical info
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Buying a home or a plot of land, building a house or a flat often requires
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substantial sums of money... Before taking such a step, you need to thoroughly
prepare your project and to gather all necessary information.
ING is happy to help you to realise your project. This brochure contains the
answers to most of your questions on this subject. It details the numerous loan
packages available, as well as the various possibilities we have developed.
Here you will also find information on the collateral and charges linked to
mortgage loans, not to mention an extensive chapter on mortgage loan taxation,
an admittedly complex matter yet with a certain impact on your budget.
For advice, further information or a personalised simulation please do not
hesitate to contact an ING adviser or surf to ing.be/home.
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Mortgage loans in concrete
terms
Before delving into details, let us first answer some general questions.
Who can take out a mortgage loan?
Any private individual usually domiciled in Belgium
when the deed is signed and who is acting mainly
outside his professional activity.
Under certain conditions ING can also grant mortgage
loans to non-residents, in other words individuals who
do not usually reside in Belgium.
What is the purpose of a mortgage loan?
A mortgage loan provides the funds required to
buy a plot of land, or to acquire, build or renovate
a property. It can also be used to repay an existing
mortgage loan or to fund inheritance duties, donation
duties, registration fees, devolution fees and other
taxes relating to one or several properties.
How much can you borrow?
The maximum amount you can borrow depends firstly
on your project and secondly on your repayment
capacity.
loan amount available through minimum instalments
of 2,500 euros, as and when the works progress, on
the basis of invoices and/or supporting documents.
The advantage is that you will only pay interest on
the capital you have actually drawn down. As from
the seventh month of the construction period, you
will pay an availability indemnity on the amounts you
have not drawn down. The latter indemnity amounts
to 1.75% per annum between the 7th and the 12th
month and then rises to 2% a year as from the 13th
month.
Pre-contractual information in accordance with
the European Code of Conduct
ING respects the European Code of Conduct for
mortgage loans. This ensures that you will receive
transparent and easily comparable information from
us.
The various forms of mortgage
loans
The various forms of mortgage loans available from ING are summarised below.
They are categorised according to, firstly, interest rate variability and, secondly, the
repayment method. We also offer several specific packages to help you to optimise
your project.
Interest rate variability packages
Fixed interest rate formula packages
Throughout the entire duration of the loan the
interest rate will not change. Consequently you will
never be confronted by any unpleasant surprises.
With this formula you opt for absolute certainty!
Over how many years can the loan repayments
be spread?
The length of a mortgage loan can range up to 30
years, according to your needs and the package you
choose. Yet the longer the term, the higher the total
cost of the loan.
Variable interest rate packages
In addition to the fixed interest rate ING also offers
formulas with variable interest rates. With such
packages, both the interest rate variability period and
the maximum interest rate fluctuations are important.
The review period determines after which period the
rate can change.
How is the amount of the loan made available to
you?
When you buy a home, ING will release the total
loan amount once the deed has been signed. If you
are building or altering a property, ING will make the
In concrete terms, you can choose from the following
formulas:
Annual variability mortgage loans (1+1+1): the
rate can be adjusted every year. This option has
a maximum interest rate variation from +3% to
unlimited (minimum 0%).
Five-yearly variability mortgage loans (5 + 5 + 5):
the rate can be adjusted once every five years. The
maximum interest rate fluctuation amounts to 5%
(minimum 0%).
A mortgage loan with initial variability after 10
years and five-yearly variability thereafter (10+5+5).
This option has a maximum interest rate variation
from 5% or +2% to unlimited (minimum 0%).
The maximum interest rate fluctuations determine the
maximum deviation, both upward and downward, in
relation to the starting interest rate. As a result you
are protected against sharp rises in interest rates. The
fluctuations are expressed as annual percentages.
Together with the initial interest rate they determine
Example
You opt for an annual review (1+1+1)
with maximum interest rate variations of
+3/-unlimited. If the mortgage loan is repaid
through monthly payments, such maximum
variations will be translated in the loan
contract as +0.247%/-unlimited (min. 0%).
The interest rate will amount to 0.291% a
month (3.55% a year). Consequently your
interest rate will never be higher than
0.538% a month (6.65% a year). The annual
review formula incorporates an additional
security for the first three years.
the first year it is the agreed interest rate
which applies, i.e. 0.291% (3.55% a year)
when the interest rate is reviewed at
the end of the first year, a maximum
fluctuation of 0.083% (1% a year) will
apply. Consequently, the second year your
interest rate can rise to a maximum of
0.374% (4.58% a year)
The periodical interest rate review
If you opt for a variable interest rate, then the interest
rate of your mortgage loan will be adjusted according
to:
The period of variability you chose
The maximum interest rate fluctuations
The trend in the statutory reference index.
The following formula is applied for that purpose:
New interest rate = starting interest rate + (new
reference index – initial reference index).
The initial reference index which is applied to the
variable interest rate you chose is indicated in the
list of charges at the time of your application and in
a maximum interest rate and a minimum interest rate
per contract which is set for the entire duration of
the loan and which may not be exceeded during the
lifetime of the loan.
when the interest rate is reviewed at
the end of the second year, a maximum
fluctuation of 0.165% (2% a year)
will apply against the starting rate.
Consequently, the third year your interest
rate can rise to a maximum of 0.456%
(5.61% a year)
when the interest rate is reviewed at the
end of the third year, the contractual
maximum fluctuation of 0.247% (3%
a year) will apply against the starting
rate. From the fourth year and until your
contract matures, your interest rate can
amount to a maximum of 0.538% (6.65% a
year).
With this formula the interest rate can drop
indefinitely. This means that each time the
interest rate is reviewed and the market is on
a downward trend, the interest rate can be
downgraded indefinitely. The interest rate
cannot, however, be negative.
your mortgage deed. The new reference index will be
that published in the Belgian Official Gazette in the
calendar month before the date of the interest rate
review.
ING uses the reference index A for the annual
reviews and the reference index E for the five-yearly
and the 10+5+5 review. These reference indexes
are determined by law; they are based on the
government debt and are communicated by the
government. An adjustment is only possible if the
application of the above formula entails a rise or
a drop of a minimum of 0.05% a year against the
previous interest rate.
Example
You opt for a mortgage loan with an
annual review and a duration of 20 years:
Monthly interest rate = 0.291% (3.55% a
year)
Maximum monthly interest rate variation
= 0.247% (valid as from the third interest
rate review)
Initial reference index = 0.181 (a month)
Reference index valid for the third
interest rate review = 0.457 (a month)
Calculation of review formula = 0.291% +
(0.457 – 0.181) = 0.567% a month (7.02%
a year)
Given the maximum interest rate
variation, this interest rate will not be
applied but limited to 0.538% a month
(6.65% a year).
Repayment method packages
Fixed monthly repayment mortgage loans
Each month you pay ING the same amount, consisting
partly of interest and partly of capital. The portion
of interest shrinks over time, the portion of capital
increases over time. The amount repaid remains the
same throughout the entire lifetime of the loan or
until the contractual interest-rate review.
Example
Mortgage loan of € 100,000 repayable
over 20 years at a fixed interest rate of
0.431% a month (5.30% a year) through
fixed monthly repayments. The monthly
instalment, valid throughout the lifetime of
the loan, amounts to €669.49.
The first monthly instalment consists of
€431 in interest and €238.49 in capital.
The second monthly instalment consists
of €429.97 in interest and €239.52 in
capital.
Fixed capital repayment mortgage loans
The capital repayments are constant - each month
you repay the same amount of capital throughout the
entire period of the loan.
The interest will be calculated on the outstanding
balance (“debt balance”) and is therefore degressive.
You will repay far more at the start of the loan and
less as times goes by.
Example
Mortgage loan of €100,000 repayable over
20 years at a fixed interest rate of 0.431% a
month (5.30% a year) through fixed capital
repayments. Each month you will repay a
fixed amount in capital of €416.67.
The first monthly instalment consists
of €847.67, with €431 in interest and
€416.67in capital.
The second monthly instalment consists
of €845.87, with €429.20 in interest and
€416.67 in capital.
Specific packages
Bullet loans: mortgage loans without interim
capital repayments
In specific cases ING grants mortgage loans without
interim capital repayments for periods of up to 20
years. With Bullet loans you only pay interest during
the lifetime of the loan.
You will repay the full amount of capital in one go
at maturity. You can match the maturity date with
the payment of a life insurance policy or a group
insurance contract for instance.
Example
A mortgage loan of €100,000 repayable
over 5 years at a fixed interest rate of
0.403% a month (4.95% a year) according
to the "Bullet" formula. For 5 years you
will pay a fixed amount of interest of 403
euros a month. The full amount of the loan
(100,000 euros) will be repaid in one go at
the end maturity.
Bridge loans
Say you want to buy or build a home and would like
to - partly or totally – fund it with the proceeds from
the sale of another property. Unfortunately you do
not know the precise date of the sale, yet you do
need the funds to buy or build your new home.
In concrete terms you determine the term of the loan
(generally 6 or 12 months). On the date the property
is actually sold you repay the loan in one go.
As such dates are imprecise, no reinvestment penalty
is charged in the event of early repayment. The
interest rate for an ING Bridge Loan is set for the
entire lifetime of the loan.
Example
A mortgage loan of 100,000 euros
repayable over 12 years at an interest rate
of 0.477% a month (5.50% a year) through
a bridge loan. For 12 months you will pay
a fixed amount of interest of 447 euros a
month. The total capital must be repaid in
one go after 12 months, but you will not
pay a reinvestment penalty if you repay the
loan early.
Collateral:
your loan guarantees
Mortgage loans inevitably entail one of the securities stipulated by the law on
mortgage loans: a mortgage, a notary public mandate or an undertaking to grant
a mortgage. Generally the collateral will be taken on the property which is the
subject of the mortgage loan; however it can be taken on any other property
located in Belgium.
It is possible to combine such collateral. Everything depends on the elements of
your file.
Such loans are available with the following variability
options: 1 + 1, 5 + 5 and a fixed rate. A Bullet loan
can be combined with a conventional mortgage loan.
The value of the property
Opening of a mortgage loan
Obviously an important element in your file is the
value of the property which will serve as collateral
for your mortgage loan. The market value1 of the
property is assessed by one of the real estate experts
with whom ING works. In some cases the pre‑sale
agreement or other documents can suffice to
establish the value of the property.
If your loan is (partly) covered by a mortgage,
ING grants loans for the purpose of taking over a
mortgage loan opening. The ensuing mortgage
registration is valid for 30 years. This means that the
capital you have repaid at a given time can, subject to
ING's approval, be used again for a new loan without
any supplementary notary charges2.
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The value of property on the free market.
Renewal charges are owed in some situations.
The charges
Insurance
The charges linked to the conclusion of a mortgage loan depend on various
To purchase or build a property is a major project requiring the best possible safe-
parameters. The types of charges are summarised below. Your ING branch can help
guards. To that end two essential insurance packages are available to provide you
you to estimate the actual cost price.
with peace of mind: outstanding balance insurance and fire insurance.
Dossier fees
The processing of a mortgage loan application entails
certain costs. Such costs are only due once you have
received an official loan offer from us. In some cases
a change to your file may also incur additional dossier
fees. Please read the list of charges for an overview.
Survey charges
A survey by an ING-approved independent surveyor
is an estimate of the value of the properly you are
buying, (re)building or on which collateral is taken. It
is based on several elements (surface area, location,
number of rooms, etc.). It is undoubtedly a useful
document in which you receive the advice of a
professional about the worth of the property. If a
survey is made you will pay the surveyor directly.
Naturally you will receive a copy of the survey. A
survey is not always required: in many cases the presale agreement or other documents can suffice to
establish the value of a property.
In some cases a mortgage serving as collateral for the
mortgage loan can be totally or partially replaced y “a
mandate to grant a mortgage” (a notary mandate).
Re-investment penalty
You can repay the loan in full or in part at any time. If
the amount repaid is lower than 10% of the capital,
such repayment is only allowed once per calender
year. In the event of early repayment, you must pay
a re-investment penalty which corresponds to three
months interest on the capital amount you repay. The
re-investment penalty is not charged in the case of
early repayment:
through an “outstanding balance” insurance
following the death of the credited party
an ING Bridge Loan.
Deed of purchase charges
The purchase costs include in particular the notary
costs linked to the purchase, the registration fees of
the deed of purchase or V.A.T. if the property you are
purchasing is new.
Outstanding balance insurance
ING Outstanding Balance insurance safeguards
your next of kin from the bother of repaying your
mortgage loan if you were to die. For the utmost
security, ING recommends that you take out full cover
for each borrower. In that way, in the event of death,
the loan repayment will always be fully covered.
The premium will be calculated on the basis of the
insured capital, the term of the contract, smoking
behaviour and the actuarial age of the insured on
the simulation date. The final premiums, which are
determined once the insured's state of health has
been assessed and after financial acceptance, are
confirmed in the contract. Under certain conditions,
people with a higher health risk can benefit from a
concession on the outstanding balance insurance
premiums. Consult your insurer, your bank or your
advisor for further information. The insurer is free
to chose the beneficiary. Nonetheless, in some cases
the choice of beneficiary can influence a possible tax
break on the premium (in this regard please refer to
the chapter on mortgage loan taxation).
Tip: by taking out ING insurance together with
your mortgage loan you can benefit from a
lower interest rate under certain conditions. You
can read the precise conditions in the charges
for mortgage loans.
Charges for a mortgage deed or
notarised mandate
The costs of a deed with a mortgage registration
include the fees for the registration of the mortgage,
the mortgage fees and the fees of the notary. They
vary in particular according to the amount of the
mortgage.
insurance policy of ING Life Belgium SA/nv with a single premium or risk premium
(Premiums paid to cover the risk of death for one year. Such premiums vary from
one year to another). The capital insured decreases or remains constant according to
the mortgage loan. The premium tax on each premium paid in amounts to: 1.1%
if the insured capital is degressive, 2% if the capital insured is constant. For further
information please consult your ING branch.
ING Outstanding Balance insurance is offered by:
Insurance agent
ING Belgium SA/nv, an insurance broker registered with the FSMA under the code
number 12381A.
Registered office: avenue Marnix 24, B-1000 Brussels – www.ing.be – Brussels RPM/RPR –
VAT BE 0403.200.393 - BIC: BBRUBEBB – IBAN: BE45 3109 1560 2789.
Insurer
ING Life Belgium SA/nv, an insurance company approved under the code number 2550.
Registered office: cours Saint-Michel 70, B-1040 Brussels – Brussels RPM/RPR –
VAT BE 0890.270.057. BBRUBEBB – IBAN: BE28 3100 7627 4220.
Fire insurance
Fire insurance covers possible damage to your
property in the event of a fire, flooding, a break-in,
natural disaster, etc. Although it is not obligatory,
such insurance is more than recommended for any
home-owner.
ING wants to protect you at best and therefore offers
Home and Family Blanket insurance. In addition to
the basic cover, you can choose from a broad raft of
extra options (theft and vandalism, family civil liability,
vehicles not in use) which you can take out according
to your situation and specific needs. In the event
of a claim, you can always rely on fast and efficient
help from ING Home Assistance, via ING Assist'Line
(02/550 06 00) which is accessible 24/7, 365 days a
year.
Tip: For new constructions and recent buildings,
ING grants a special discount of 55% the first
year and 15% the following five years on the
“building” premium.
ING Home and Family Blanket Insurance is provided by:
Insurance agent
ING Belgium SA/nv, an insurance broker registered with the FSMA under the code number
12381A. Registered office: avenue Marnix 24, B-1000 Brussels – www.ing.be –
Brussels RPM/RPR – VAT BE 0403.200.393. – BIC: BBRUBEBB – IBAN: BE45 3109 1560 2789.
Insurers
ING Life Belgium SA/nv, an insurance company approved under the code number 2551.
Registered office: cours Saint-Michel 70, B-1040 Brussels – www.ing.be –Brussels RPM/RPR –
VAT BE 0890.270.750. – BIC: BBRUBEBB – IBAN: BE95 3200 0812 7458.
Allianz Belgium SA/nv, an insurance company approved by the authorities under the
n° 0097 to provide "Life" and "Non-Life" insurance.
Registered office: rue de Laeken 35, B-1000 Brussels – Brussels RPM/RPR –
VAT: BE 0403.258.197 Phone: + 32 2 403.41.11 Fax.+ 32 2 403.43.78 – www.allianz.be –
BIC: BBRUBEBB – IBAN: BE64 3100 0356 6252.
Mortgage loan taxation
Other housing you own and which is for sale on
the property market as at 31 December of the year
the loan contract is concluded and is actually sold
by the latest on 31 December of the following
year,
Foreword
This brochure is based on current legislation as at the begining of 2015.
In addition this brochure deals exclusively with the tax regulations applicable to loans.
property which is not characterised as a home, e.g.
building land, a garage, student accommodation
and business premises.
Did you know that it is the credited party who
is responsible for proving that the home is for
sale?
Proof can be provided if you have called on
a real estate agent (who has actually put the
home up for sale), placed an advertisement, etc.
Funding the purchase, building or renovation of a property through a mortgage loan
generally entails tax savings which considerably reduce the total spending cost.
Such tax savings can relate to both the interest paid on the loan and to the capital
repayments, as well as the outstanding balance insurance premiums1.
Regional tax benefits:
home bonus
Own home:
An own home is the home in which you live as the
owner, occupier, (joint) heir or as usufruct during the
taxable period.
Such an own home does not include:
the portion of the home which is used for
professional purposes by the taxpayer or a family
member
(a part of) the home lived in by people who are not
family members of the taxpayer.
When you take out a loan to acquire or preserve an
own and only home, under certain conditions, such
loan can be taken into consideration for the Regional
'home bonus' tax reduction.
The tax benefit of the home bonus is allocated as a
tax reduction at a fixed percentage, determined by
the Regions.
Whether a home is an only home is determined on
a daily basis. If you have taken out a loan to fund
the home, then it is the moment when the capital
repayments, the interest and individual life insurance
premiums are paid that is taken into consideration to
check whether or not it is an own home.
Since 1 January 2015 the three Regions are
competent for the tax incentives of housing
taxation.
taxation is still joint) the family is still deemed to
reside in the Region where the last matrimonial place
of residence was established.
What does this imply?
The Flemish, Walloon, and Brussels Capital Regions
are exclusively competent for the tax benefits for
the expenses to acquire or maintain an ‘own home’.
In other words that is the home you may, through
inheritance, jointly own, or own in bare ownership or
as a usufruct and live in yourself.
One single fiscal place of residence can be determined
per tax year.
Henceforth the Regions can determine the tax rules
for own home benefits independently from each
other. The federal authorities remain competent for
the tax benefits relating to ‘not-own homes’.
Own home: Regional competence
The Region in which your 'fiscal place of residence' is
located on 1 January of the tax year is competent for
the taxation of your own home.
The fiscal place of residence is the place where you
work and live permanently. Such place can differ from
the place where you are registered with the municipal
authorities.
For married couples or legal cohabitants who are
taxed jointly, the fiscal place of residence is the place
where the family is established.
For the year of actual separation (the year in which
Definition of "own and only" home
Only home:
A taxpayer is deemed to have an “only home” if he/
she only owns one home as at 31 December of the
year the loan contract is concluded nor may he or
she have other housing, through inheritance, jointly
owned, or owned in bare ownership or as a usufruct.
Nonetheless a home you do not actually live in
yourself can be your 'fiscal residence'. Moreover,
it will be considered that your home is your own
home if you do not actually live in it for the following
reasons:
For professional or social reasons,
Due to legal or contractual constraints which make
it impossible to live in the home.
Account is not taken of:
other housing you may, through inheritance,
jointly own (and not 100% own), or own in bare
ownership or as a usufruct,
For instance, a new home is not occupied
immediately because it is inhabited by the tenant
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during a transitional period. Or: the previous owner
sold the home on the condition he could continue
to occupy it during a transitional period.
due to insufficient progress of construction or
renovation works you are unable to actually live
in your home. To satisfy this condition, you can
use the following criteria as proof of the start of
works: the date on which an application to execute
the aforementioned works, the date on which an
agreement was signed with a builder, building firm,
architect, etc. to implement or supervise the works,
the date on which the required building materials
were ordered.
If you invoke this last reason, you must actually live
in the home as at 31 December of the second year
following the year the loan contract is concluded.
Otherwise, the taxpayer can only benefit from
the regional tax reduction for long-term savings
and in the Flemish region for the ordinary interest
deduction (see below). The loss of the home
bonus is final except where the legal or contractual
obstacles are still valid or due to insufficient
progress of construction or renovation works you
are unable to actually live in your home. In such
cases a return to the 'own and only home' system
is possible provided you move into the home in the
year the obstacles are removed or the works are
completed.
Home in the European Economic Area
The home financed must be located in the European
Economic Area. The 28 Member States of the
European Union belong to the European Economic
Area: Austria, Belgium, Bulgaria, Croatia, Cyprus,
Czech Republic, Denmark, Estonia, Finland, France,
Germany, Greece, Hungry, Ireland, Italy, Latvia,
Lithuania, Luxembourg, Malta, the Netherlands,
Poland, Portugal, Romania, Slovakia, Slovenia, Spain,
Sweden, United Kingdom, plus Iceland, Liechtenstein
and Norway.
What are the tax advantages?
Tax benefits are granted for the loan expenses
of interest actually paid, capital repayments and
Under certain conditions.
A basic amount of 2,290 euros
An increase of 760 euros per taxpayer, during the
first ten taxable periods as from the year the loan
contract is concluded. The amount of 760 euros is
increased by 80 euros if the taxpayer has at least
three dependent children during the year following
the year the loan is concluded. The increase for
dependent children is valid for the period during
which the 760-euro increase is applied. The
aforementioned increases no longer apply for the
first taxable period during which the taxpayer
becomes the owner, long-term lessor, superficial
owner or beneficial owner of a second home. The
taxpayer’s situation is re-examined for this purpose
on 31 December of each taxable period. The loss
of the right to increases is final, even if during
these ten first years the taxpayer transfers the
ownership or beneficial ownership of the second
home.
first taxable period during which the taxpayer
becomes the owner, long-term lessor, superficial
owner or beneficial owner of a second home. The
taxpayer’s situation is re-examined for this purpose
on 31 December of each taxable period. The loss
these ten first years the taxpayer transfers the
ownership or beneficial ownership of the second
home.
The final tax advantage is calculated at a one-off rate
of 40%.
The basic amounts and increases are indexed.
The maximum tax benefit per taxpayer who takes out
a loan is calculated as follows:
(2,290 + 760 + 80)
x 40% = 1,252 euros
The final tax advantage is calculated at a one-off rate
of 45%.
The basic amounts and increases are indexed.
individual life insurance premiums covering the loan
collateral exclusively.
Flemish Region
The Flemish Region allows the following fiscal
residence benefits:
The maximum basket for the application of the tax
reduction amounts to 2,360 euros (2016 tax year,
2015 income) per taxpayer and breaks down as
follows:
An increase of 760 euros per taxpayer, during
the first ten taxable periods as from the year the
loan contract is concluded. The amount of 760
euros is increased by 80 euros if the taxpayer
has at least three dependent children during the
year following the year the loan is concluded.
The increase for dependent children is valid for
the period during which the 760-euro increase
is applied. The aforementioned increases no
longer apply for the first taxable period during
which the taxpayer becomes the owner, longterm lessor, superficial owner or beneficial
owner of a second home. The taxpayer’s
situation is re-examined for this purpose on
31 December of each taxable period. The loss
these ten first years the taxpayer transfers
the ownership or beneficial ownership of the
second home.
(2,290 + 760 + 80)
x 45% = 1,408.50 euros
What happens if the capital repayments
suffice in themselves to fill the basket?
The law does not stipulate any order of allocation
between the interest, the capital repayments
and outstanding balance insurance premiums.
In principle, if the three types of expenses are
indicated in the tax return, the three will be
allocated evenly.
Walloon Region
The actual tax advantage is calculated at a one-off
rate of 40%.
The basic amounts and increases are no longer
indexed.
(1,520 + 760 + 80)
x 40% = 944 euros
Brussels Capital Region
follows:
follows:
(For the Walloon Region the same basic amounts and
increases apply as for the Brussels Region. The basic
rate to calculate the tax advantage is 40%.)
An increase of 760 euros per taxpayer, during the
first ten taxable periods as from the year the loan
contract is concluded. The amount of 760 euros is
increased by 80 euros if the taxpayer has at least
three dependent children during the year following
the year the loan is concluded. The increase for
dependent children is valid for the period during
which the 760-euro increase is applied. The
aforementioned increases no longer apply for the
Consequently, if the maximum deductible
amount is attained with the capital repayments
and the interest, preferably the taxpayer ought
never to indicate his/her outstanding balance
insurance premiums in his/her tax return, thereby
avoiding taxation of the capital paid in the event
of death.
Interest on loans taken out for own and only
homes and for which the home bonus applies,
can only be entered under the home bonus and
can no longer be taken into consideration for the
ordinary tax reduction for interest.
Caution:
If you take out a new loan for your own and
only home and you are still bound by a loan
concluded before 1 January 2015 for which you
benefit from a tax break, you will need to pay
special attention to the possibility offered to you
by the law of “choosing” and/or combining the
way you are taxed in relation to the relevant tax
system.
Can both partners benefit from the home
bonus?
A loan taken out prior to a marriage or the
statement of legal cohabitation by one partner
for his own and only home where such single
owner (occupier, long-term lessor, beneficial
owner or usufruct), is the only owner, does not
entitle the other partner to the "only home
deduction" even where he also repays the loan.
Nevertheless the authorities allow the deduction
of the loan expenses for the other spouse or
legally cohabiting partner in the event:
1.he or she is liable for the cadastral income
(e.g. following the legal marriage settlement
where the home is part of the joint property,
or in the event of divorce with a clause of
joint assets), and;
2.the other partner is included in the loan
contract as the joint credited party.
Discretionary distribution between spouses or
legal cohabitants
Where a joint tax return is filed and both spouses or
legal cohabitants are credited parties and are entitled
to the home bonus, the spouses or cohabitants are
free to split the expenses linked to the loan (capital
repayments and interest), as well as the life insurance
premiums (with the limits) between themselves,
irrespective of each of their shares in the joint assets.
De facto cohabitants, who each file their tax
return separately, may not apply such discretionary
distribution as it is done for them in relation to their
respective assets.
The discretionary distribution does not apply in the
first year of the wedding or legal cohabitation. During
that year the partners are indeed still taxed separately.
A loan with a minimum duration of ten years must
be secured by a mortgage registration (a mandate
will not suffice). If your loan is partly secured by
a mortgage, only such part will benefit from the
aforementioned tax advantages.
The mortgage loan must be taken out specifically to
acquire or preserve an own and only home.
This refers to:
1. The purchasing of a home including registration
fees or V.A.T.
2. The building of a home
3. Total or partial renovation of a home
4. The payment of inheritance duties relating to a
home.
5. The payment of donation duties relating to a
home.
Conversely, loans used to fund the purchase of land
are not covered by these provisions, as their purpose
is not to acquire a “home”, unless the land loan is
taken out at the same time as a loan aimed at (partly)
financing the building of a home.
Conditions relating to the outstanding balance
insurance contract
The contract must be concluded before the age of
65.
The contract must cover his/her own life exclusively.
The taxpayer = the policyholder = the insured.
The amount insured is lower than or equal to
the amount of the mortgage loan taken into
consideration for the home bonus (and for which
a mortgage registration has been taken – therefore
neither a mandate nor an undertaking)
The advantages stipulated by the insurance
contract must be indicated as follows:
- up to the amount serving to reconstitute or
secure the loan, the contract is in favour of
persons who, in the event of the death of the
insured, acquire full ownership or beneficial
ownership of the property
- for any balance, the contract is to the benefit
of the spouse, legal partner or parents up to
the second degree of the taxpayer (children,
grandchildren, parents, grandparents, brothers
and sisters).
Regional tax benefits: long-term savings
tax reduction
The capital repayments of mortgage loans and life
insurance premiums paid for loans relating to the
not only1 but own2 home, give right to the regional
tax reduction for long-term savings. Irrespective of
the loan date, the reduction amounts to 30% of the
expense, provided the region does not change the
rate.
The tax reduction is calculated as follows:
[Capital repayments + outstanding balance
insurance premiums]
x 30% (single tax reduction)
The fiscal limits of the tax reduction for long-term
savings in the Flemish Region are no longer indexed
and for the 2016 tax year (2015 income) will remain
at the level of the 2015 tax year (2014 income).
The fiscal limits for the tax reduction for long-term
savings are still indexed in the Walloon and Brussels
Capital Regions.
Only the capital repayments relating to the first
76,110 euros (Flemish Region) or 76,360 (Brussels
and Walloon Regions) of the initial amount of the
loan give right to the tax advantage. Furthermore,
for each spouse, the total capital repayments taken
into consideration for the tax reduction and the
outstanding balance insurance premiums may not
exceed 15% of the first amount of 1,900 euros
(Flemish Region) or 1,910 (Brussels and Walloon
Regions) of professional income and 6% of the
surplus, with an absolute maximum of 2,280 euros
(Flemish Region) and 2,290 euros (Brussels and
Walloon Regions).
In addition, this amount will be reduced by any
amount the customer might deduct from another
loan under the own and only home taxation.
For the Flemish Region:
2,280 x 30% = 684 euros
For the Brussels and Walloon Regions:
2,290 x 30% = 687 euros
To be assessed on 31 December of the year during which the loan is concluded.
To be assessed when the capital repayments and insurance premiums are made.
3
4
To be assessed when the interest is paid.
The loan must be taken out by the actual taxpayer
from an institution established in the European
Economic Area.
The mortgage loan must be secured by a mortgage
registration.
The mortgage loan must have a minimum duration
of 10 years.
The purpose of the loan must be to build, acquire
or renovate a home located in Belgium or in
another European Union country.
insurance contract
The contract must be concluded
before the age of 65.
When the contract stipulates advantages in the
event of life, it must have a minimum duration of
10 years.
The advantages stipulated by the insurance
contract must be indicated as follows:
ownership of the property
- for any balance, the contract is to the benefit
of the spouse, legal partner or parents up to
the second degree of the taxpayer (children,
grandchildren, parents, grandparents, brothers
and sisters). The right to deduction remains valid
where such insurance is secured by a mortgage
lender, i.e. ING.
Regional tax benefits: tax reduction for
interest
The interest paid on loans relating to the non-only3
but own4 home give right to the regional interest tax
reduction.
The Special Finance law no longer stipulates the
ordinary interest tax deduction for loans taken out
as from 1 January 2015. Consequently the Federal
authority has left the decision to allow such interest as
a tax benefit up to the Regions. At the present time,
only the Flemish Region has allowed the interest on
1
2
such loans taken out as from 1 January 2015 at the
40% tax reduction rate. Both the Walloon and the
Brussels Regions only allow the interest deduction for
loans taken out before 1 January 2015.
Non-only home: federal authority
Expenses relating to the acquisition or preservation of
a property abroad, rental property or other properties
which are not of a housing nature (land, business
premises without housing, etc.) remain a purely
federal competence.
Federal tax benefits: long-term savings tax
reduction
The federal tax reduction for long-term savings
applies to capital repayments on mortgage loans and
life insurance premiums relating to non-only1 and
non-own2 homes. The reduction amounts to 30%,
irrespective of the date on which the contract was
concluded.
The fiscal limits of the tax reduction for long-term
savings will no longer be indexed as from the 2015
tax year (2014 income) until the 2018 tax year (2017
income).
Initial amount of 75,270 euros
15% of the initial amount of 1,880 euros of the
net taxable income and 6% of the surplus,
with an absolute maximum of 2,260 euros
2,260 euros x 30% = 678 euros
The loan must be taken out by the actual taxpayer
from an institution established in the European
Union.
The mortgage loan must be secured by a mortgage
registration.
The mortgage loan must have a minimum duration
of 10 years.
The purpose of the loan must be to build, acquire
or renovate a home located in Belgium or in
another European Union country.
When the contract stipulates advantages in the
event of life, it must have a minimum duration of
10 years.
The advantages stipulated in the insurance contract
must be established as follows:
ownership of the property; for any balance, the
contract is to the benefit of the spouse, legal
partner or relatives up to the second degree of
the taxpayer (children, grandchildren, parents,
grandparents, brothers and sisters). The right
to the reduction remains acquired when such
insurance is given as by a mortgage lender, i.e.
ING.
Observation: as from 2015 the tax reduction
for long-term savings is at both a regional and a
federal level. To avoid a doubling of the amount
of capital repayments on mortgage loans and life
insurance premiums with regard to a given taxpayer,
the maximum amount for both deductions applies
and the basket will be first filled with the expenses
which come into consideration for the regional tax
reduction.
Federal tax benefits: ordinary interest deduction
The federal ordinary interest deduction is maintained
and will not be converted into a tax reduction.
Interest on debts the taxpayer specifically entered into
to acquire or preserve other real estate property than
the own home (non-only3 and non-own4 home) give
right to the (federal) ordinary interest deduction.
Interest is deducted from the taxable immovable
income. Cadastral income from the own home is not
part of such income as the own home is tax exempt.
insurance contract
The contract must be concluded
before the age of 65.
To be assessed when the capital repayments and insurance premiums are made.
4
To be assessed when the interest is paid.
1
2
3
Practical info
Are you interested?
This is what you must do to make your dream come true:
Take your project to the ING branch of your choice
where you will be advised on the best packages for
your loan according to your project, your situation
and your expectations,
Our branches are equipped with tools which can
compile loan estimates and give you a file with the
data from the simulation made, in accordance with
the European Code of Conduct.
If one of the simulations suits you, you can file an
official loan application. In most cases the decision
relating to your application can be taken by the
ING branch.
If an agreement is reached with regard to your loan
application, we will give you an offer confirming
all the features and terms of your mortgage loan,
together with a repayment schedule and a draft
deed.
You sign such letter with the offer within the
month following its issue.
We will provide the notary of your choice with all
the information required to compile the deed.
The mortgage loan is finalised by signing the
mortgage deed before the notary (where
appropriate). The deed must be signed within the
3-month period of validity, as indicated in the offer.
Congratulations on your new home. We wish you
every success!
We are always at your disposal for
further information.
Surf to ing.be/home or make an
appointment at your ING branch.
Mortgage loan brochure n° 21, valid as of 15 December 2015.
ING Belgium SA/NV – Bank – Marnixlaan 24, B-1000 Brussels – Brussels RPM/RPR - VAT BE 0403.200.393 - BIC: BBRUBEBB – IBAN: BE45 3109 1560 2789.
Publisher: Inge Ampe – Sint-Michielswarande 60, 1040 Brussels © Editing Team & Graphic Studio – Marketing ING Belgium – 706666E – 04/15

Materialise your property projects

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