Blog Business

How Can I Save on IMT Tax: Dealing with the Matter

Save on IMT Tax

The intention to save on IMT tax may be relevant for those who are involved in property transfers in Portugal. Follow below if you would like to learn more about it.

Understanding the Essence of IMT

IMT is the abbreviation that is typically used in the real estate language. It is a municipal tax that refers to property transfers all across Portugal. IMT is taxed on the effective sale value of the property or on the Taxable Equity Value (depending on which of these figures is going to be greater).

To reveal how big the tax will be, the following characteristics are considered:

  • What the property will be used for. There is a relevant difference between permanent own property and secondary housing;
  • Where the property is situated (the value of IMT on the mainland is higher);
  • The type of the property. Lower IMT is what refers to a rustic kind of property.

The Best Ways to Save on IMT (the Relevant Exemptions)

Here is the great news: the Portuguese authorities have introduced quite a few exemptions that can be received in connection with IMT. According to these rules, it is real to save quite a nice sum of money. The enumeration of those exemptions is going to be represented below.

  1. Getting the property with the purpose to arrange urban rehabilitation. It is real to receive a refund of the IMT’s amount if the investor plans to implement an architectural project to rehabilitate the property in some way.
  2. Obtaining real estate for sale. Applying some renovations to the property that will be purchased can be linked to the opportunity to be exempt from IMT. Normally, if such changes are applied to the object, it will be sold later. However, there is one requirement that has to be considered here: the primary purchase and resale must take place in the same calendar year.
  3. Getting the buildings or fractions in the spots that are especially popular among tourists. Acquisition of such property is normally going to be linked to arranging the guest house or something like that. The amount of IMT will be refunded after the property is officially purchased.

By the way, it is also real to save on IMT in case you deal with buildings that are classified as the ones connected to the national, municipal, or public interest. One more aspect to bear in mind is when the buildings are obtained by credit institutions in execution proceedings, insolvency, etc.

Are There Any Extra Requirements That Have to Be Considered by the Buyer?

Sure! Things are not that easy. It is important to keep in mind a few rules that are going to apply in order to be eligible for the IMT exemption.

Well, it is real to save on IMT in case there is a property rehabilitation that takes place and the investor belongs to Category B of the IRS. This is only one of the rules that apply (there are not too many of them but it is vital to consult a financial advisor who will explain everything in the clearest way possible).

Paying IMT: a Few Aspects to Be Aware of

There are several important points for those who still have to pay the IMT. The matter is that if you have a chance to be exempt from paying this tax, you will be informed about it anyway. Accordingly, you should pay the tax in case you do not come across such a notification.

Here is the list of the documents to get ready in case paying IMT is what is about to take place soon:

  • Your ID as a buyer;
  • ID document of the seller;
  • Description of the property;
  • Transmission value.

By the way, IMT is not the only kind of expense you should be ready for in case you intend to buy a property. There are a few other aspects that may require you to pay money. That is why it is so important to learn about all taxes, the price of the necessary papers, and the documents. It will allow you not to be too confused within the process.

The Help of the Financial Advisor or a Company: Is It Necessary?

If the question that sounds like “How can I save on IMT tax” really worries you, there is the sense in asking for proper assistance. First of all, it may be relevant to figure out whether your case is going to be linked to the opportunity to be exempt from the tax (there are some really complicated cases that have to be taken into account). Second, the financial advisor can give you a few valuable tips that will help you to proceed with the deed in the most effective way.

Besides, despite the fact that the services of the financial advisor may be not too cheap, you will simply be aware of all the details of your future purchase. And, you will feel more confident as a result. Accordingly, this may even influence the success of your deed in a positive way.

That is why there is no sense in trying to save on the qualitative services of the financial advisor. In some cases, you may make a decision to work with the team and really benefit from this. Follow below to get acquainted with a few tips that are going to help you to find the best provider ever.

  1. Take care to study whether the financial advisor is well aware of the details linked to saving on IMT. This may be revealed with the help of asking direct questions about it and judging the response you get.
  2. Try to find a few reviews about the financial advisor or the team you will work with.
  3. Do not hurry and take a look at a few candidates before making the final decision.

Good luck with your future purchase and hope you will have a chance to save on your IMT!