The opinion of the Technical Office of the Tax Administration about full mortgage
Returning to the letter number 2306/p/1395 dated 11/16/1395, regarding the way of action of that company in implementing the provisions of Note (9) of Article 53 of the Direct Taxes Law approved in 1366 and its subsequent amendments, regarding the cases in the rental contract, An amount is paid in the form of a good loan and returned to the tenant at the end of the contract (the same amount that is used in the term “mortgage” in rental contracts in the form of full mortgage or mortgage and rent), informs:
With regard to the provisions of note (9) of article 53 of the said law, which obliges the persons subject to this note to deduct rent tax from the paid rent, as well as the provisions of part (c) paragraph (2) of circular 13530 dated 07/1384 27, which stipulates that the persons mentioned in Note (9) of Article 53 should only use the amount they paid for the leased property as a basis for deducting mandatory taxes. Also, if the property has been assigned as a mortgage of possession (without receiving rent) – full mortgage – the deduction and payment of tax due to non-payment of rent is excluded, so the persons subject to Note (9) of Article 53 of the Direct Taxes Law, They do not have an obligation to deduct rent tax for the amounts they have paid to the owner in the form of a loan (deposit) (mortgage amounts in rental contracts, including mortgage and full mortgage).
It is worth mentioning that following the recent amendment of the Direct Taxes Law approved on 04/31/1394, this issue has been clarified in Note (1) of Article 54 of the Amendment, which is the reason for the aforementioned note if the tenant is one of the subjects of Note (9) of Article 53 of this law. The rent paid by the tenant will be the criterion for determining the income subject to rent tax.
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