Income: Get to know the new support for tenants

Problems with credits or insurance? The credit intermediaries and insurance mediators at Poupança no Minuto are specialists who can help you save with these products. Contact us so we can try to achieve the highest savings and enter 2024 without financial problems.

But if you're a tenant, first understand what will happen to rents next year.

Government announces new income supports, instead of a new brake (https://example.com).

The Government announced the new measures regarding rent support to help tenants, instead of imposing a new brake.

Now, the incomes will be updated by 6.94% starting from January 2024, ending the imposed limit of 2% in 2023.  

But what supports are available from the Government to compensate for the rise in rents? Get to know:  

• Two-thirds of the rent increase for tenants with a burden rate exceeding 35% will be shared.

According to the press conference of the Council of Ministers, it can be read in a statement released by Notícias ao Minuto: “The State will subsidize more than two-thirds (4.94%) of the rent increase for households up to the 6th IRS bracket, with effort rates exceeding 35%. These tenants will therefore bear only 2% of the increase, compared to the expected increase of 6.94% resulting from the legal and automatic rent update formula”.

Therefore, it will be an measure automatically updated for tenants already receiving extraordinary rent support.

Let's go to an example? Notícias ao Minuto explains that "a rent with a value of 800 euros/month and a salary of 11600 euros currently has a support of 200 euros per month (2,400 euros per year)". With the update of rents in 2024, the rent value rises by 55.52 euros, but updating the support results in an extra income of 39.5 euros (474 euros per year). This implies an extra monthly effort of 16.02 euros.

• Deduction limit with rental income increases by 10%  

With the measure above, a second measure arises, now regarding the tax deduction of tenants.

All households will now be able to deduct an additional 10% for rents, which will absorb part of the rent increases.

That is, "the deduction limit for rents will increase from 502 euros per year to 550 euros," clarifies the news.

In general, the increase in rents will amount to 2%.

Through the statement cited by the news platform, Finance Minister Fernando Medina ensures that overall, the rent increase will be equivalent to 2% in most families. This is to counter negative comments about the decision to remove the rent cap by the Left Bloc (BE) coordinator.

"What is determined for the large portion of Portuguese families is that the increase in rents is an increase of 2%", since "that is what the decisions made by the Government in the Council of Ministers consecrate," explains.

In response, Minister of Housing Marina Gonçalves also demonstrates that this is a "quick and automatic" way to respond to the increase in rents, which she considers to be a "balanced, fair, and substantial measure" in achieving the objective. Furthermore, the minister also highlights that the majority of households with rental contracts will be covered by the measure.

If you need to stretch your budget in 2024, know that Poupança no Minuto can help you save with loans and insurance. This can be done through credit consolidation or insurance transfer, for example.

The credit intermediaries at Poupança no Minuto offer a free service and constant support to help your budget grow! Contact us and see what we can do for you.