Does your property have a tax value over 1 million euros?
In October 2012 a new law was passed allowing the tax department to charge an additional stamp duty on properties whose tax value (as seen on the IMI property tax bills) was 1 million euros or over. Property owners were shocked to receive bills of over 5,000 euros to be paid by the 20th December 2012, this being 0.5% of the tax value of their property.
Since then, each year proprietors of these ‘luxury houses’ are being charged 1% tax on top of the IMI property tax already paid. The tax bills arrive in April, July and November. So a property with a tax value of 1 million euros has 10,000 euros stamp duty to pay as well as on average 4,000 euros IMI tax.
Recently the tax department extended this charge to urban land destined for habitation.
The tax department also began to apply the tax to apartments with lower tax values because they were part of a building whose total properties exceeded the 1 million tax value. Despite protests and courts ruling in favour of property owners, decreeing that the tax should not apply to individual apartment owners, the tax department continues to send out the bills!
If your property tax value is above 1 million, contact Sovereign who have already successfully applied for reductions in the tax value of clients’ properties. They submit a request to the tax department to review your property’s tax value and if reduced below 1 million euros you will no longer have to pay the additional stamp duty!
Sovereign - Consultoria Lda
Parque Empresarial Algarve
Tel: +351 282 340480
Fax: +351 282 342259
Whilst every effort has been made to ensure that the details contained herein are correct and up-to-date, this information does not constitute legal or other professional advice. We do not accept any responsibility, legal or otherwise, for any error or omission.