If you own multiple houses, how can you deduct interest payments from your taxable income?

"Check your house loan interest to ensure it qualifies for tax deductions according to the Revenue Department's conditions before filing your tax return."

At the end of every year, taxpayers should review their tax returns to determine which deductions they can claim. house loan interest is one such deduction. If you own only one house, understanding how much house loan interest can be deducted is easy. However, for those owning multiple houses, the amount can be confusing. Here's some easy-to-understand advice for those with multiple houses:

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Multiple Houses with Single Borrower

Generally, house loan interest can be deducted up to the actual amount paid, but not exceeding 100,000 baht. This applies to multiple houses financed by a single borrower. You can deduct interest paid on your combined house loans up to a maximum of 100,000 baht. For example, if you own two houses, and the interest paid on the first house is 50,000 baht and on the second house is 60,000 baht, you can deduct up to 100,000 baht in interest, even if the actual interest paid is 110,000 baht.

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Multiple houses with Joint Loans

If you own multiple houses with joint loans, the interest deduction should be divided equally among the number of co-borrowers. However, before dividing the interest... The interest paid on a joint house loan for each house cannot exceed 100,000 baht. For example, if two people jointly take out a loan and the total annual interest is 120,000 baht, according to the interest deduction criteria, the actual amount deductible is limited to 100,000 baht. Therefore, each person can only deduct 50,000 baht in interest. If there are multiple houses, the averaged interest amounts will be added together. Each person can claim a deduction of no more than 100,000 baht.

For example, consider three houses: two jointly owned and one individually owned. Let's assume:
House 1: Jointly owned, each co-borrower receives 40,000 baht in interest.
House 2: Jointly owned, each co-borrower receives 30,000 baht in interest.
House 3: Individually owned, with 50,000 baht in interest.
The total interest is 120,000 baht. However, the maximum deduction for this interest is 100,000 baht. If the total interest from all three houses is less than 100,000 baht, the deduction is capped at 80,000 baht. For example, if the total interest from all three houses is 80,000 baht, the deduction is capped at 80,000 baht.

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However, some types of house loan interest are not tax-deductible, such as loans for house renovations or loans secured by a debt-free house. A multipurpose loan can be taken out in addition to an existing house loan. Therefore, before claiming house loan interest deductions, you should check the contract to determine the type of loan to avoid violating the Revenue Department's regulations. Follow related articles on house purchases.

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Thank you for the helpful information from DD Property.