Hypotheekrenteaftrek: how your mortgage and home are taxed

How the deduction works

The home you live in is in Box 1: tax on income from work and your home. Two amounts from it go into your Box 1 income each year. The interest you paid on your mortgage comes off, and the eigenwoningforfait is added. What's left of the interest lowers your taxable income, so you pay less tax.

The interest is deductible if the mortgage is for your main home, and you used it to buy, build or improve that home. A mortgage taken out since 1 January 2013 has a third condition: you must pay it off in full within 30 years, at least as fast as an annuity mortgage (the same payment every month, paid off by the end). A linear mortgage, with the same repayment every month, also qualifies. An interest-only mortgage (aflossingsvrije hypotheek) from before 2013 keeps its deduction under the old rules.

A second home, or a home you rent out, isn't in Box 1. It's in Box 3, as an investment, and its mortgage is a debt there. The Box 3 guide explains that.

The eigenwoningforfait

The eigenwoningforfait is an amount added to your income because you own the home you live in. It's a share of the WOZ value, the value your municipality (gemeente) sets each year for tax. For 2026 the tax office uses the WOZ value on 1 January 2025:

For a home with a WOZ value of €500,000, it's €1,750 a year. The WOZ value is often lower than what your home would sell for.

Once your mortgage is paid off, or if the interest is less than the eigenwoningforfait, you'd pay tax on the eigenwoningforfait alone. A separate deduction (aftrek wegens geen of geringe eigenwoningschuld) takes most of that away: in 2026 you deduct 71.87% of the difference. For the €500,000 home with no mortgage, €1,258 comes off again, so €492 is added to your income. This share gets smaller each year, so a home without a mortgage slowly costs more tax.

What you get back

The deduction lowers your taxable income from the top, so you get it back at the rate of the bracket it comes off. In 2026 that's:

The top bracket is 49.5%, but the deduction isn't worth that much. For income above €78,426, the tax office adds a correction (tariefsaanpassing) of 11.94% of the deduction, so it's worth 37.56%, the rate of the second bracket. It's worked out for you in your tax return.

Most people get the deduction each month, not once a year. Ask the tax office for a voorlopige aanslag (a provisional assessment): it pays the tax back monthly, based on the interest you expect to pay.

What the example household gets back

The interest falls every year, because they pay off part of the debt each month. So the tax back falls too.

The 30-year limit

You can deduct the interest for at most 360 months (30 years). For a mortgage taken out since 2001, the 30 years start when you take it out. For a mortgage from before 2001, they started on 1 January 2001, so 2030 is the last year with a deduction.

After the 30 years, you still pay the interest, but none of it comes off your income. A mortgage taken out since 2013 must be paid off by then, so the limit only bites on an older mortgage that isn't paid off: often an interest-only one from before 2013. If that's yours, plan for a higher net payment from the year its 30 years end.

When your mortgage runs into retirement

The deduction doesn't stop when you stop working. It stops when the mortgage is paid off or its 30 years are over. What changes is how much it gives back:

• Before your AOW age, your Box 1 income may be much lower than your salary was. If you live from your savings until your pensions start, there's little Box 1 tax for the deduction to come off.
• From your AOW age, income up to €38,883 is taxed at 17.85%, so each €100 of interest gives back about €17.85, half of what it gave while you worked. The tax after AOW age guide explains why.

The example household plans to retire in 2042, at 52 and 50. Their mortgage still has 12 years to run then, and they'll live from their savings until their pensions start. So to stop in 2042, they need savings for the payments still to come as well as for their budget: €152,665 of what they need pays the mortgage until 2054.