Is the Mortgage Arrangement Fee Tax-Deductible?

The most important points at a glance

In the past you paid an afsluitprovisie (arrangement fee) to take out a mortgage; today we refer to it as mortgage advice costs. We'll use the term afsluitprovisie here to keep things clear.

1. Is the arrangement fee I paid tax-deductible?

The arrangement fee you pay is tax-deductible, which means you can benefit from it for tax purposes. You pay the fee in order to take out your mortgage and finance your home. The deductibility only applies to the first home you finance with a mortgage loan.

2. Deducting both the arrangement fee and the interest

Can't pay the arrangement fee out of pocket, or want to make the most of the tax benefits? You can deduct the arrangement fee from your taxable income. This also applies to the interest you pay on that portion of the mortgage. For example, if you pay €2,500 in arrangement fees and decide to include this in your mortgage to finance the property, you can claim this amount once as an additional deduction, and then also deduct the mortgage interest on the total amount.

3. Remortgaging and the arrangement fee

If you want to remortgage and in doing so pay the arrangement fee again because you used mortgage advice, the fee is deductible again, provided the mortgage is used entirely to finance your own home. If there is a penalty interest or another loan you want to include in the mortgage, that portion of the mortgage loan is not deductible. In that case, you need to calculate which portion of the loan is deductible on a pro-rata basis. The arrangement fee is deductible, provided the loan is used to finance your first primary residence.

4. Financing costs when moving home

Already own a home and thinking about moving? Then you'll be dealing with financing costs, which can add up quickly. Keep in mind that you cannot deduct the interest on these costs if you pay them from the mortgage. So the arrangement fee itself is still deductible, but a mortgage advisor can explain exactly which interest charges are not. That way you get a clear picture of the tax options available so you can make the most of the deductions relative to your taxable income.

Expert mortgage advice

Want to know more about your mortgage options? Request a free, no-obligation exploratory consultation with a mortgage advisor from HypotheekBerekenen.nl.