Documents needed to sell your property in Portugal

Are you thinking about selling your property?
Wondering which documents will be needed ?

Find below the list of all the documents you will have to provide :
We always suggest our guests to have all those documents ready as soon as you want to market your
property even if some of them will only be necessary on the day of the deed.
This is time saving for a quick sale as the potential buyer will be able to have a maximum of information to
take his final decision and time saving for initiating the promissory contract and the deed.

 

  • Identification of Sellers

Copies of Identity Card or passport and Fical number ( NIF ).
Note: If the seller is a society : copy of the Commercial Registration Certificate of this company and copy of
the identity car of the legal representant.
Purpose: Identity Verification.

  • Certidão Permanente de Registo Predial

Issuing Entity: Conservatoria do Registo Predial of the area where the property is located. The period of
validity is six months.
Purpose: Verification of the true owner of the property and any liens or charges (liens, mortgages or any
usufruct in favor of third parties).

  • Caderneta Predial Urbana /Rustica

Simple photocopy of the updated caderneta predial or certificate of contents of the inscription.
Issuing Entity: Finance Office of the area where the property is located or online finance website. The period
of validity is one year.
Purpose: Verification of the situation regarding IMI-Property Tax.

 

  • Licença de utilisação / Alvara de utilisação

License of Use License, also known as Habitability License.
Note: It is also valid the public deed of the transmission made previously in which it is said that such license
was displayed.
Building License Permit in case the property is still in the process of construction.
Issuing Entity: City Hall
Purpose: To verify the legality of construction of the property.

  • Official Plans of the Property ( with town hall stamp )

Maps of the property - including, if applicable, storage, garages or annexes.
Location plan.
Issuing Entity: Construction company; Town hall.
Purpose: To verify more accurately the areas of the property; Provide detailed information to the buyer client.

  • Energetic certificate

Energy certificate of the property (except for land).
Issuing Entity: Qualified Expert for its order for Energy Certification and Indoor Air Quality of Buildings.
Purpose: Check energy class of the property.

  • Housing Technical File (FTH) - Required for property > March 2004

Issuing Entity: It is the obligation of the Promoter to prepare the Technical Data Sheet for the property.
Purpose: To ensure technical and functional characteristics of the building.
Need help selling your home?
Fill out the form and we will contact you to find out everything we can do to help you selling your home.

The tax system for non-habitual residents

To boost its economy, Portugal, a member of the European Union, has put in place tax incentives for nationals of EU member states, which obviously benefit the French, who sometimes have ties with this country.

Since January 1, 2013 (date of entry into force of the circular n ° 9/2012 of August 3, 2012), European retirees who settle there, benefit from a total exemption of IRS (the Tax on the Portuguese income), for 10 years, on their retirement pensions.

To claim this new measure, candidates must:

  • make the choice to come and settle permanently in Portugal,
  • to justify that the pensions paid are not from Portuguese sources or imposed in the state of the source in application of the rules provided for by the tax treaty,
  • be retired from the private plan (employees and corporate officers of companies, liberal professions, tradesmen, craftsmen, etc.),
  • to have a stay of at least 183 days a year (non-consecutive) in Portugal,
  • have a residential dwelling on Portuguese territory on December 31, indicating the intention to keep or use this dwelling as a principal residence,
  • Certify that they have never elected a tax domicile in Portugal during the last five years.

Value added tax in Portugal

Owner of a property in Portugal, if I sell more expensive than its purchase price. How and where am I taxed?

Real estate income or surplus value is always taxed in the country where the property is located (in accordance with the tax covenants signed in 1971 between France and Portugal) to avoid double taxation. The surplus value is therefore taxed in Portugal.

The real estate tax is due at the same time as the income tax: you must declare it on your IRS tax return in Portugal.

Any sale of real estate must also be declared to the Tax Authority, which generates or not the surplus value.

Here are the main exemption cases:

  • Property acquired before 01/01/1989 is not subject to real estate capital gains tax.

If the property was acquired after 01/01/1989, it will be subject to tax.

  • However, the Portuguese tax code provides for an exemption in case of sale of the principal residence (own and permanent housing) and re-use in the work of purchasing, building or improving a new principal residence. The replacement must be made in advance in the 24 months prior to the sale, or a posteriori within 26 months of the sale of your principal residence. In the case of partial reintegration, the amount not reinvested will be subject to tax.
  • For sales between 2015 and 2020 of goods purchased through a loan contracted before 12/31/2014, the Portuguese tax code provides for an exemption if it concerns the sale of its single residential property. . You should not, therefore, own another property on the day of sale.

Therefore, if you sell a property that is not your primary residence, or is your primary residence, but you do not want to reinvest the sale price when you purchase a new principal residence, you will be subject to real estate tax.

For individuals, half of the amount of real estate capital gain is included in another taxable income for the IRS if you are a Portuguese tax resident.

If you are a non-Portuguese tax resident, you do not benefit from this 50% discount, and you will be subject to 100% real estate gain tax.

The calculation of the taxable capital is therefore as follows:

Sales value - Purchase value revalued on the day of sale (to account for inflation) - deductible expenses (list below) x 50% (only if I am a Portuguese tax resident) = taxable amount.

You will notice that the purchase price is reevaluated to take inflation into account. The Portuguese State annually publishes a table of the revaluation coefficients of money, which will allow it to determine its updated purchase value.

Deductible expenses include taxes paid on the purchase: IMT and IS, notary fees, registration fees, work done less than 12 years, cost of diagnosing energy performance, commission paid to the real estate agency for the sale of the property. To be deductible, these amounts must be justified by an invoice in your name.

The tax rate or tax "pressure"?

For a Portuguese tax resident: 50% of the capital gain included in your other income and taxed on the progressive scale according to your marginal tax range.

Example: Purchase in 2007 for € 180,000 (including the 5% commission due to the agency by the seller) of a property resold € 300,000 in 2017. In deductible expenses, we have the work done in the last 12 years for € 24,500 and energy certificate required for the sale of an amount of € 300, then the costs incurred at the time of purchase € 450, and the transfer fees due at the time of purchase for € 5,900 and finally the real estate agency fees during the sale 5% x € 300,000 = € 15,000

Capital gain = 300,000 -199,800 (€ 180,000 revalued to take into account inflation according to the scale fixed by the state) - 300 - 24,500 -450 - 5,900 - 15,000 = € 54,050

Any amount to declare with your IRS: 50% x 54,050 = € 27,025 taxed on the IRS Progressive scale.

For a non-resident Portuguese taxpayer: 100% of the real estate capital gain taxed on the IRS at the fixed rate of 28%. It should be noted that it can not claim exemption from re-use in the purchase of a new principal residence in Portugal, since it is by definition not resident in Portugal.

For the same example, the non-resident tax would be taxed at 100% of the € 54,050 capital gain at the flat rate of 28%, ie: tax amount = € 15,134.

As a reminder, the rate currently applicable to the taxation of real estate capital gains in France is 36.2% (fixed settlement of 19% + social contribution of 17.2%), to which an exceptional contribution of 2% in the case can be added of a surplus value exceeding 50,000, then the exceptional contribution in high income at the rate of 3% or 4% (when the fraction of reference tax income, including taxable income, is higher than € 250,000 per taxpayer). However, a tax deduction on taxable capital gain is applied in France, depending on the number of years of detention.

For the same example, the gross capital gain would have been € 64,200, and after applying the deductions for the holding period, the tax would have been € 17,756.

 

 

What is Golden Visa?

An attractive scheme launched by the Portuguese authorities in 2012, for foreign investors from non-EU countries (excluding Schengen area) so that they can obtain an official residence permit valid in Portugal (called the "Golden Visa" ).


This Golden Visa aims to attract foreign investment to Portugal. Under this program, citizens from non-EU countries who undertake certain investments in Portugal can obtain residence in the country, which allows the investor and his family members to to enter and / or leave the borders, and to travel freely in the European countries integrating the Schengen Area.


A simple and flexible program, with simple and clear legal requirements, which include a reduced minimum permanence requirement.
 
Required conditions

Investors must demonstrate one of the following:
• Entering Portugal with a valid Schengen visa;
• Not to be convicted of a serious offense;
• Maintain the investment for at least 5 years;
• The funds for the investment in question must come from abroad;
• Not to be referenced by the Portuguese and Schengen immigration services.
• A minimum stay of 7 days in Portugal during the first year and 14 days in the next 2 years.
To obtain their Golden Visa, investors must therefore meet the specified requirements.
 
Investments

Only investments made after October 8, 2012 are eligible for the Golden Visa Program.

The following types of investments are eligible under the Golden Visa Program:


a) Real estate investment
- Acquisition of a property of more than € 500,000.00;
- Or a property of more than € 350,000.00, when the property is over 30 years old and is located in an urban renewal area.


b) Capital Investment
- Transfer of funds exceeding € 1,000,000.00;
- Transfer of funds exceeding € 350,000.00 for research activities;
- Transfer of funds over € 250,000 for artistic or cultural activities.
- Transfer of funds exceeding € 350,000.00 for the acquisition of units of investment funds or venture capital funds;
- Transfer of funds exceeding € 350,000.00 for the incorporation / acquisition of a company, combined with the creation of 5 jobs.


c) Job creation
- Creation of at least 10 jobs.


d) Startup visa
- This has been promulgated recently, and has been in effect since January 1, 2018. It will be necessary to demonstrate that the startup can either achieve a value of € 325,000 in 3 years, or have annual revenues of € 500,000.00.

Advantages

The Golden Visa program offers investors the following benefits:
- It is not necessary to obtain a visa to enter Portugal;
- It is not necessary to obtain a visa to travel to Europe (in the Schengen area);
- Live and work in Portugal, even having his residence in a different country;
- The residence is extended to the members of the family;
- minimum permanence requirements in Portugal;
- Permanent residence after 5 years;
- Citizenship after 6 years.
 
Is it possible to extend the Golden Visa to family members?

Under the Golden Visa Program, family members of the investor can also apply for and obtain a residence permit in Portugal by applying for "family reunification".

The Golden Visa will extend to family members, namely, children, spouse and dependent family members.

Validity

The Golden Visa is valid for one year and can be renewed for periods of two consecutive years. For reasons of renewal of a Golden Visa, an investor must stay in Portugal for at least 7 days in the first year and 14 days in the next two years.

Costs

- Registration fees - € 520,40
- Golden Visa Fee - € 5.202,60
- Renovation fees - € 2.601,30

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