In Portugal, the following are applied to real estate:
- the Municipal Property Tax (IMI), which is the municipal tax on the taxable value of the property;
- the Municipal Tax on Real Estate Transfer (IMT), tax applicable to transmissions, for a cost, of the ownership of real property or the transmission of parts of this right (use and housing, surface rights, usufruct, etc.);
- and stamp duty, a tax that applies to all acts, contracts, documents, titles, roles and other facts or legal situations, including free transfers of goods.
It is the municipal tax on the taxable value of the property, which is no more than the value registered in the land register, on December 31 of the year in respect of the IMI, which is determined by a property assessment, taking into account the building value per square meter, the area, the allocation, the location, the characteristics of quality and comfort as well as the age of the property.
The property’s matrix contains, in particular, the characterization of the property, the location, its taxable value and the identity of the owners.
Matrices are updated every year, on December 31st.
The IMT is the tax that applies to the transmissions, for a consideration, of the ownership of real property or partial figures this right (use and housing, surface rights, usufruct, etc.).
This tax is levied on the value of the purchase and sale agreement or on the taxable value of the property, whichever is greater. It results from the application of variable rates, only in the case of properties for housing may vary between 0 and 6%. When located in the autonomous regions of the Azores and Madeira, it benefits from rates reduction.
It is a tax that applies to all acts, contracts, documents, titles, roles and other facts or legal situations, including free transfers of goods. In the case of acquisition of properties, payable on the value of the purchase and sale agreement or on the taxable value of the property, whichever is greater, and results from the application of the rate of 0.8%.
The settlement of the tax is a responsibility of the interested (buyer) to buy the property. Taxes must be settled and paid before the conclusion of the deed of sale of the property. If transmission occurs abroad, the tax payment must make up for the following month.
To make the payment, you should go to any Tax Office, through the Tax Authority’s Portal, or to a “Balcão Casa Pronta” office.
Urban Rehabilitation
The properties that are the subject of the owner’s rehabilitation works may have benefits regarding Property tax and Tax on Property Transfer;
Cultural heritage
The acquisition of properties individually classified as national interest, public interest or municipal interest, in accordance with applicable law, may have benefits in tax based on the Real Estate Transfer (depending on application to be presented before the act or contract, before discharge), Stamp Duty and Property tax.
If the acquirer is a Legal person resident in a country, territory or region subject to a more favorable tax regime, the aggravated rates are as follows:
Tax on Property Transfer - 10%;
Property Tax - 7.5%;
Stamp Duty - 7.5% (of all urban properties worth over one million euros).
Where to obtain more information?
Related Links
Related Links
Tax Authority’s Portal: www.portaldasfinancas.gov.pt
Source: Ministry of Finance
