What situations are subject to IMT?


IMT is payable, as a rule, on the transfer of immovable assets located in Portuguese Territory. Several situations will trigger IMT, namely:

- The purchase of a property;
- A rental agreement that states that once all the rent payments have been made, the tenant will become the property owner;
- A rental agreement with a duration superior to 30 years;
- The exchange of properties, when they have different values;
- The acquisition of company shares (in a LDA company), whenever the company owns a property and a shareholder holds at least 75% of the shares.

Usually, IMT is paid before the property transmission becomes effective, which normally occurs when the deed of purchase and sale is signed at the Notary. However, IMT is due before the promissory contract of purchase and sale is signed, whenever the buyer takes possession of the property.


Who is due to pay IMT?


- In a purchase and sale contract, IMT is due by the buyer of the property;
- In an exchange agreement, IMT is due by the party who receives the property with the greater value;
-In a promissory contract of purchase and sale that includes a clause allowing the assignment of the buyer’s contractual position to a third party, IMT is due by the promissory buyer and by any subsequent(s) third party(ies). The same rule applies when the buyer’s contractual position is assigned as stated in the promissory contract of purchase and sale;
-In an irrevocable Power of Attorney, IMT is due by the agent (usually, a solicitor) who is authorized to conduct the transaction on behalf of the principal.


The purpose of this publication is to provide general tax information about the Portuguese tax laws that apply to nonresidents who own, intend to buy or sell a property in U.S.A., Malta, Portugal, Cape Verde.



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