Interview for Infomoney. Read the full article
The purchase of a property involves expenses that go beyond the value of the asset itself, and one of them is the ITBI, a municipal tax levied on real estate transactions.
Most of the time, this tax is associated with the purchase and sale of real estate. However, it may also be present in situations involving estate and succession planning. In this case, depending on the assets, it is possible to avoid its incidence through the creation of an appropriate asset-holding company.
What is the ITBI?
The ITBI (Tax on the Transfer of Real Estate / Imposto sobre Transmissão de Bens Imóveis) is a municipal-level tax that is levied when a real estate purchase and sale takes place.
“Whenever there is an onerous transaction involving real estate – a purchase and sale, an assignment, or a giving in payment (dação em pagamento) – the ITBI will apply,” explains tax attorney Juliana Assolari, partner at Lassori Advogados.
In other words, whenever someone acquires a property, whether a house, an apartment (including off-plan units) or even a plot of land, they must pay the ITBI at the time the asset is registered at the registry office.
Calculation basis of the ITBI
In some cases, the calculation basis of the ITBI tends to give rise to disagreements.
According to Juliana Assolari, some municipalities have begun to demand payment based on the reference market value (valor venal de referência), which is a market value set by the city government. This led many taxpayers to complain, demanding that the tax be calculated taking into account the value of the negotiation, and not the market value.
For example, if the property cost R$ 1 million and the reference market value was R$ 1.5 million, the taxpayer was required to pay the tax based on R$ 1.5 million, even though they had paid less for the asset.
← Back to blog