Check here your IMT and Duty Stamp

Check here the IMT exemptions

Check here the Duty Stamp general board and its exemptions

IMT and IS

Taxes over the onerous and free property transmissions are the Municipality Tax over Property Onerous Transmissions (IMT) and the Duty Stamp (IS).

PATRIMONIAL TAXED VALUE

The patrimonial taxed value (VPT) over urban buildings for the IMT is the one on the property registration document.

The VPT of the rustic buildings for IMT purposes is not described on the property registration document and it corresponds to the multiplication of the initial patrimonial value by the applied factor of the inscription year.

Check here the VPT correction factors of rustic buildings for the IMT and the IS.

ONEROUS TRANSMISSIONS

Property

Property onerous transmissions such as sales, permutations, common thing division, death and divorce shares (for the divorce ones it is over the acquired excess) and onerous cessions of the inherited fair share are subjected to the following payments:

• IMT’s over the highest of two values: the price or the patrimonial taxed value (VPT) of the property; in the case the property is to be dwelled, the tax is applied to differenced taxes (medium and marginal) and established according to the transaction amount, and also to differenced taxes if the property is located in the continent or in the islands; in case it is a rustic property a 5% tax is applied; in case it is a non-dwelling urban building (business, services, parking, or urban construction land), a 6,5% tax is applied; the IMT is paid by the acquiring person (the buyer);
• IS’s, Verba 1.1 Duty Stamp General Board (TGIS), over the highest of two values the price or the patrimonial taxed value (VPT) of the property, a rate of 8 for one thousand which is paid by the acquiring person (the buyer);
• Capital gains over IRS or IRC focused on the profit of the property onerous alienation and which are supported by the person alienating (seller)

The capital gains tax is done in IRS or IRC during the year of the onerous alienation; if the onerous alienation is the result of a usual activity, its gain is included with the other annual revenue, having a unitary fiscal analysis; however, if it is an unexpected or fortuitous patrimonial addition, and consequently not included in a commercial or professional activity, that addition is taxed in G category (capital gains).

Capital gains are calculated based on the positive difference between:

• The right value at the moment of its acquisition, which means, the purchase price (the acquisition value) updated and based on annually fixed coefficients by an ordinance, adding the purchase expenses such as the deed, the registration, the acquisition taxes and the works made in the property for the last 12 years which have improved its value;
• The value of the right at the moment of its alienation, which means, the purchase price (realization value), minus its expenses, such as documents and commissions paid to real estate agencies.

Check here the updated coefficients

Capital gains in G category are included in the seller revenue just for the half of its value and can be exempted in case of a reinvestment.

This is a complex and long subject impossible to be fully explained here.

For further information, access our article:

Mais-valias Imobiliárias – “O IRS e a sustentável leveza do IRC” in Ordenamento do Território, Urbanismo e Cidades. Que Rumo? Editora Almedina, 2017.

Other places

Onerous transmissions of an industrial, commercial or agricultural places, when IVA is not due, are subjected to Duty Stamp, Verba 27 of the TGIS, a 5% rate.

Free transmissions

Properties

Property donations are subjected to:

• Duty Stamp, Verba 1.1 of the TGIS, 8 for one thousand rate, paid by the acquiring person (donee);
• Duty Stamp, Verba 1.2 of the TGIS, 10% rate, paid by the acquiring person, being exempted the spouse, the non-marital united, the descendants and the ascendants;

The other free transmissions are only subjected to the Verba 1.2 of the TGIS payment.

Usucaption justification

The usucaption justification is subjected to the Duty Stamp, Verba 1.2 of the TGIS, 10% rate, payment by the justifying person, being exempted the spouse, the non-marital united, the descendants and the ascendants.

Properties

Onerous transmissions of properties (for example, movable donations subjected to different registrations or inscription, social participations, properties and associated credit rights, titles and public debt certificates, monetary values, commercial, industrial or agricultural spaces, industrial property rights, copyright and related, among others) are subjected to the Duty Stamp, Verba 1.2 of the TGIS, 10% rate, payment by the justifying person, being exempted the spouse, the non-marital united, the descendants and the ascendants.

FIND MORE

Municipality Tax over Property Onerous Transmissions (IMT)

The IMT which has replaced the Sisa Municipality Tax is paid by the acquiring person and is focused on:

• The onerous transmission of the property right over the real estate (and the partial figures of that right such as the usufruct, the right of inhabit or use, the right of surface or the right of servitude), including permutation, acquisition by share (divorce or death) or by division (in the case of share or division related to the acquired excess), the acquisition during the leasing contract validity, the acquisition by the tenant or the exercise of the preference right) and these rights can be transmitted in some different ways (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• The alienation of the inheritance or the inherited fair share which includes real estate (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• The promise of acquisition and alienation (purchase and sale, permutation) with the tradition of the goods (only subjected to IMT);
• The promise contract which establishes that the proponent buyer can cede his contractual position to a third, as well as the contractual position evidence and, in this case, taxation is done over the part of the price paid for each of the contracts and the tax over the total price agreed is applied and when the proponent buyer or the person ceding makes the definite contract, the tax already paid will be taken in account for the final liquidation (subjected to IMT only);
• The so-called “irrevocable” power of attorney giving the power to alienate a property and the represented renounces the right to revoke the power of attorney: the attorney and the subset are respectively subjected to the 5% or 6,5% rate taxation, depending on the power received to alienate rustic or urban buildings, having no exemption or tax reduction, unless the definite purchase and sale contract is made with the attorney or the subset (subjected to IMT only, not applied for divisions and shares);
• Tenancy including transmission property and unlimited tenancy or subtenancy (subjected to IMT only);
• Improvements transmission (subjected to IMT only);
• Real estate acquisition by accession (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• Right alienation over waters (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• Acquisition of social parts or quotas in the legal person societies, limited partnership or limited partnership with shares when those societies hold real estate and when due to that acquisition, by amortization or any other facts, one of the partners holds, at least, 75% of the social capital or the partners are reduced to just two married or non-marital united (subjected to IMT only);
• Entering with property to realize social capital for the commercial society constitution or capital increase (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• The property adjudication to the partners during the liquidation of commercial societies (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• The transmission of real estate for fusion or division and societies (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);
• Indemnifying by public utility property expropriation (cumulatively with the Verba 1.1 of the TGIS, 8 for one thousand rate);

Duty Stamp (IS)

The IS is the oldest Portuguese fiscal system tax, which is paid by the buyer and it is applied over several operations, such as:

• The onerous transmission of the property right over the partial figures of that right in the property, such as resolution, invalidity or extinction, by mutual consent, of the respective contracts when they are not subjected to IVA (to avoid double taxation) 8 for one thousand rate, Verba 1.1 of the TGIS (cumulatively with IMT);
• The transmission agreement for a commercial, industrial or agricultural space and the sub concession and its transmission agreements, 5% rate Verba 27 of the TGIS, when those contracts are not subjected to IVA;
• The transmission over donation of the right of property or the partial figures of that right over property such as the resolution, invalidity or extinction, by mutual consent, of those contracts since the beneficiary is not an IRS passive subject, even if exempted, a 8 for one thousand rate and 10% of the Verba 1.2 of the TGIS (this Verba replaces the former Tax over Successions and Donations); the spouse, or the non-marital united, the descendants and the ascendants are exempted of Verba 1.2.
• The free acquisition of real estate other than donation such as for example inheritance or extinction of a right for death (usufruct), a 10% rate of the Verba 1.2 of the TGIS; the spouse, or the non-marital united, the descendants and the ascendants are exempted of Verba 1.2.
• The free transmission such as, for example, registration or inscription, social participations, properties and associated credit rights, titles and public debt certificates, monetary values, commercial, industrial or agricultural spaces, industrial property rights, copyright and related, among others, since the beneficiary is not an IRS passive subject, even if exempted, a 10% rate of the Verba 1.2 of the TGIS; the spouse, or the non-marital united, the descendants and the ascendants are exempted of Verba 1.2.
• The usucaption acquisition since the beneficiary is not an IRS passive subject, even if exempted, a 10% rate of the Verba 1.2 of the TGIS; the spouse, or the non-marital united, the descendants and the ascendants are exempted of Verba 1.2. (for example when the usucaption acquisition is a result of a verbal donation made from parents to children.