The Head of the Tax Office is responsible for the first assessment, based on the following: — the form submitted by taxpayers or any other available information; — the date of requesting the property’s recording or updating in the land registry. The form to record or update an urban property is submitted … Read More
Posts By: Carlos Tome
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Classification of Properties
Under the terms of the IMI code, properties are classified as follows: Land outside of an urban settlement (not land for construction): — allocated to agriculture, or having agricultural purposes; — without construction, or having only outbuildings or accessory structures without economic autonomy and of minor value. Land within an urban settlement: — … Read More
Municipal Property Tax
Municipal Property Tax ( Municipal Real Estate Tax ) (“IMI”) applies to the taxable assessed value of properties (rural, urban or mixed) in Portugal. It was created by Decree Law no. 287/2003 of 12 November, which approved the “Municipal Real Estate Tax Code”. — The tax must be paid by those, who are property owners, … Read More
Capital gains
— Calculation of capital gains — Reinvestment — Real estate sales may generate income subject to income tax (IRS) (with a capital gain resulting from the difference between the purchase and sale prices). The following must be known to calculate the capital gain amount: — purchase price and year; — costs of property … Read More
Stamp Duty
The acquisition of real estate is subject to a Stamp Duty of 0.8%, regardless of whether it involves a purchase/sale, donation or inheritance. Real estate donations are also subject to Stamp Duty (10%). The final applicable rate is 10.8% against the property’s taxable assessed value (per the legal description). The rate of only … Read More
VAT (IVA) in construction
Construction works for certain types of properties may be entitled to a reduction in tax rate (6% in mainland Portugal, 4% in the Azores and Madeira). This rate applies to the improvement, remodelling, renovation, restoration, repair and conservation of properties or individual parts of these allocated to residential purposes. Cleaning work, maintenance of green … Read More
Exchange of real estate and the IMT tax
Exchange of real estate In this case, you will only pay IMT if the real estate exchanged is given different values, or if there is a difference between their assessed values. Only those handing over property of a lesser value and paying the difference in cash, or those receiving a property with a … Read More
Reduction in IMT tax rate
Residential real estate may be entitled to a reduction in IMT when the purchase price is less than €574,323 (mainland Portugal) or €717,904 (Azores and Madeira) = reduced rate. This reduction also varies according to the real estate’s purpose (permanent primary residence of buyer = lower IMT than that of property intended for rental, … Read More
Cases of Exemption from IMT tax
Exemption Residential real estate purchased in 2011 whose value is less than €92,407 (mainland Portugal) or €115,509 (Azores and Madeira) are exempt from IMT. Other cases of exemption: — real estate (houses or land) up to twice the balance of the emigrant account used in the purchase. If the property’s price is €100,000 … Read More
Property Transfer Tax (IMT) tax benefits
Some transactions may be entitled to exemption from IMT, or a reduction in the tax rate (e.g. the purchase or exchange of residential real estate, up to a given amount). Exemption Residential real estate purchased in 2011 whose value is less than €92,407 (mainland Portugal) or €115,509 (Azores and Madeira) are exempt from … Read More