There is an extension of the IMI exemption of real estate with a tax registration value of EUR 66,500 or lower (considering the entirety of the real estate owned by the household) held by taxpayers part of a household with a gross total income of € 15,295 or lower.The exemption will now apply to the share of each heir that meets the requirements to benefit from the exemption. It is required that the real estate is held by an undivided estate and is allocated to the permanent home of said heirs.
There is an amendment of the provisions on the assessment of the tax registered value of land for construction. The respective computation is now clearly foreseen. According to the new rules, and differently from the former rules, the percentage given by the value of authorised or foreseen buildings, land included (one of the parameters of the computation, ranging from 15% to 45%) now applies to the entire computation method.
The previous distinction between Private Limited Liability Companies (“Sociedades por Quotas” or “Lda.)) and joint stock companies (“Sociedades Anónimas” or “SA”) ceases to exist. Real Estate Transfer Tax applies at 6.5% in the following cases:
acquisition of shares in non-listed companies whose assets consist of more than 50% of real estate located in Portugal;
when such real estate is not directly allocated to a commercial, industrial or agricultural activity (except resale), and
by virtue of such acquisition, redemption of shares of any other facts, one of the shareholders owns at least 75% of the sharecapital (or the number of shareholders is reduced to two married persons or in a non marital partnership).
In case of ownership of a participation of at least 75% of the sharecapital (by means of acquisition, redemption or in other situations) as well as in case the number of shareholders is reduced to two married persons or in a non marital partnership, own shares held by the company should be allocated to the shareholders in proportion of their respective participation.
A new rule is introduced for quota holders, shareholders or other unitholders that have paid IMT upon the acquisition of shares or participating units, and that become owners of real estate as a result of a subsequent transaction (by means of dissolution of the company or any other transaction for a consideration). The amount of IMT payable by the quota holder, shareholder or other unitholder shall correspond to the difference between the IMT due and the amount previously paid.
Entities held directly or indirectly by offshore entities are not entitled to the suspension of IMI applicable in case of resale.
Aggravated IMI and IMT rates (7.5% respectively 10%) also apply in case of indirect ownership by offshore entities. I.e., in case of real estate owned by a company under the direct or indirect domain or control (within the meaning of the Company’s Code) of an entity resident in an offshore territory.
Extension of the tax regime applicable to a national fund for the restoration of buildings (“Fundo Nacional de Reabilitação do Edificado”)
This tax regime is extended until 31 December 2025. It was formerly currently established under the tax regime applicable to Real Estate Investment Funds for Residential Letting (“Fundos de Investimento Imobiliário para Arrendamento Habitacional”), having ended in 31 December 2020.
“Although there are no major amendments to the taxation of real estate, the major change relates to the taxation of the acquisition of shares in joint stock companies that own real estate, even with a limited scope. The same rationale underlies the new provision triggering property transfer tax on the transfer of joint stock companies that own real estate.”