Even now that the European Central Bank has started to lower interest rates, the mutual remains one of the main cost items in the family budget. However, there are incentives that allow you to save up to 22% in interestfrom 19% tax deductions on passive interests to green mortgageswith advantageous rates in the case of purchasing and renovating a highly energy efficient property.
Let’s see in detail how and until when to take advantage of these benefits so as to save on your mortgage.
Mortgage Tax Breaks: What Will Change from 2025?
The most well-known benefit to consider when taking out a mortgage is the 19% tax deduction on passive interest.
Italian law provides for a deduction from gross tax equal to 19% of passive interestsof the related additional charges and of the revaluation quotas of the mortgage stipulated for the purchase of the main residence, in limit of 4,000 euros the year. This means that the maximum tax saving is 760 euros per yearregardless of the income received.
The Budget Law 2025 However, it could introduce changes to mortgage tax breaks, cutting tax deductions for taxpayers with incomes above a certain threshold. Although the measure still needs to be approved, this provision risks having a negative impact on those who are already paying off a mortgage with interest rates that are still high.
In addition to the deduction on passive interests, other deductions are still active in 2024 home tax breakssuch as renovation bonuses or ecobonuses.
Green Mortgage: How to Save Up to 22% Interest
Another option for save up to 22% interest is represented by the green mortgage. Green mortgages are designed to facilitate the purchase or renovation of properties with high energy performance, in compliance with European regulations that impose increasingly stringent standards on the energy consumption of buildings.
For properties classified in the categorie A, B o Cbanks offer particularly favorable financing, with lower interest rates than traditional mortgages.
Green mortgage rate simulation class AB Source Telemutuo
Simulation of classic mortgage rate class over C Source Telemutuo
The interest rate of the green mortgage can be up to 0.60% lower than the rates of traditional mortgages.
Over the course of the entire financing, this can result in significant savings. For example, on a 150,000 euro mortgage with a term of 30 years:
- mutuo greenfor class A or B properties, with an APR of 2.94%, the monthly instalment is approximately 627.56 euros.
- classic mortgagefor high energy consumption properties (class above C), with an APR of 3.66%, the monthly instalment amounts to approximately 687.04 euros.
The total paid in 30 years would be:
- 225,922.50 euros with an APR of 2.94%.
- 247,332.70 euros with an APR of 3.66%.
Tax savings resulting from the 19% deductions on passive interests:
- 13,468 euros (Tax savings on green mortgage over 30 years).
- 16,556 euros (Tax savings on a classic mortgage over 30 years).
Therefore, by choosing the mortgage with the lowest APR, you would save approximately 21.410,20 euro on total interest, with a saving of 22% on the interest paid, in addition to benefiting from an Irpef deduction of 13,468 euros over 30 years.
