Economy Minister Luis Caputo said the government intends to expand “aggressively.” The possibility of applying deductions to the income tax paid by people Those who earn a certain level of income. This is a concrete way in which the burden can be reduced by passing the law, while at the same time – according to officials’ idea – generating an incentive to request invoices when making purchases.
In an interview with La Nacion+, Caputo said that the planned amendment – which he did not provide details about – would allow “everyone who pays dividends… Deduct everything from your coffee maker to your mortgage payment.
Discounts are Amounts subtracted from the income on which income tax is calculated. Therefore, it leads to a reduction in the tax burden. They arise from three types of concepts: There are discounts They are determined by law and apply to everyone and their amount depends on whether he is an employee, a retiree or a self-employed person (In practice, it is what makes those who do not reach a certain amount of income exempt from tax); There are discounts By dependent family members (Spouse and/or children), and there are discounts series of expenses, Which has been included in the regulations.
As for The amount that can be deducted In the case of expenses, limits generally apply. That is, the entire amount of expenses is not subtracted from income, but rather a part of it. Not all of these extreme values receive the same treatment: some are subject to a Auto update Due to inflation, such as those governing the deduction of domestic service salaries or housing rent, and there are others Frozen for more than two decades, Because its amendments depend on discretionary decisions, and in fact neither the previous governments nor the current government have amended it.
In this last group, for example, Interest on mortgage loans To purchase housing (maximum is only $20,000 per year), or Funeral expenses From the person affected by the tax or from dependent family members (a small amount of $996.23 is deducted).
What deductions are allowed and what limits apply? The most important are the following:
• children: They must be under 18 years of age or unable to work. One parent can take 100% of the deductible, or the deductible can be split 50% and 50%. From income for all of 2025, when the final tax calculation is made, $2,140,852.77 will be deducted for each child under 18 and $4,281,705.53 will be deducted for each child who is unable to work.
• husband: It is required that the person does not have an income, and if he does have an income, the number, which will be for the entire year 2025, does not exceed $4.5 million. This year’s deduction is $4,245,166.13.
• Rentals (tenants and owners): For renters, two discounts apply, which are announced separately. One of them enables you to deduct 40% of the income from what was paid and record it in the corresponding invoice; Meanwhile, there is a limit that in 2025 will be $4,507,505.52. He must not own any property. As for the other deduction, it allows a deduction of 10% of the rental amount, without limit or condition because you are not a landlord. This 10% discount also applies to owners of properties rented for residential use.
• Home service: Salaries and contributions are deducted, with a maximum for all of 2025 of $4,507,505.52.
• Prepaid medicine: Fees paid by health plans are deductible up to a maximum of 5% of net profit for the year.
• Medical fees: From the amount invoiced by service providers that is not reimbursed by prepayment or social work, 40% is deducted to the extent that is applied when settling the tax, which is 5% of the net profit.
• Donations: It must be for the national treasury or provincial and municipal treasuries, or for religious institutions, associations, foundations and civil entities, if they are recognized by ARCA for this deduction; The limit is 5% of annual net income.
• Life insurance and retirement: For each coverage, a maximum annual limit of $573,817.13 applies for 2025, according to ARCA on its website.
• Education expenses: School fees and purchases of supplies and tools necessary for the education of children up to the age of 24 are included, if they practically do not have their own income; The maximum deduction for this year is $1,803,002.
• Interest on loans: It must match a residential mortgage loan, but it is a weightless deduction in practice, because the annual limit has been frozen for more than 20 years at $20,000.
• Expenses for purchasing clothing and/or equipment: They must be items intended for the exclusive use of the workplace and must have been paid for by the employee (with no refund).
• Contributions in mutual guarantee companies: In this case, there is no limit, but a 100% deduction is made, but on the condition that the subscriptions remain with the company for at least two years, calculated from the date of submission.
The discounts listed are pretty much the same Salaried, retired and self-employed. In the case of this third group, tax lawyer Diego Fraga explains, it is also possible to deduct considered expenses necessary to obtain income. For example, rent for a property and services, or car expenses, “always within limits and with the classic unreliable look of ARCA.”
This view is so classic that, in recent years, differences in tax rules (self-employed people pay income taxes on a lower income, compared to employees) have been justified by officials or legislators under the pretext that everyone who carries out an activity on his own has Greater margin for applying discounts.
However, there are limits that are quite outdated. For example, a recent report by the Professional Council of Economic Sciences of the City of Buenos Aires notes that the 1998 AFIP (now ARCA) resolution that established in $7,200 Maximum deductible amount for “automotive maintenance and operation expenses” Provided that they are vehicles whose use is the main purpose of the economic activity carried out. This amount has not been updated yet.
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