Local Property Tax (Imposto Municipal sobre Imóveis – IMI) is payable annually, based on the taxable value of urban, rural and commercial properties in Portugal. This is payable by the property owner, as registered on the 31 December of the year that it concerns.
IMI rates 2020 | |
Property Type | Tax Rate % |
Urban property | 0.3 to 0.45 |
Rural property | 0.8 |
Property owned by a company registered in a ‘blacklisted’ jurisdiction | 7.5 |
Exemptions: Urban properties that are considered as a permanent place of residence are exempt from IMI for a maximum period of three years from the date of acquisition if the property’s tax value is under €125,000 and the taxpayer’s annual income is under €153,300.
The IMI payment schedule is as follows:
- Tax charge up to €100 – Paid in a single instalment in May
- Tax charge between €100 to €500 inclusive – Paid in two instalments, in May and November
- Tax charge over €500 – Paid in three instalments, in May, August and November.
Additional Property Tax (AIMI)
AIMI is an additional property tax. The taxable basis corresponds to the sum of the rateable values – ‘Valor Patrimonial Tributável’ or VPT – of all urban properties held by each taxpayer, regardless of residency, as reported on 1 January of each year. AIMI bills are issued in July for payment in September.
The tax applies as follows:
- Individual property owners – AIMI is applicable to individual property owners if the sum of all VPT equals or exceeds €600,000, or to married or cohabiting couples who opt to submit a joint tax return if the sum of all VPT equals or exceeds €1.2 million. It is charged at 0.7% on the sum of all VPT over €600,000 and up to €1 million, 1% on the sum of all VPT over €1 million and up to €2 million, and 1.5% on the sum of all VPT over €2 million.
- Corporate property owners – Properties held by companies will pay an additional bill of 0.4% on the full VPT value. If the company is registered in a ‘blacklisted jurisdiction’, the company will pay AIMI of 7.5% on the full VPT value, in addition to the IMI charge of 7.5%.
As a tax consultant specializing in international taxation and property-related levies, I've engaged extensively with various taxation systems, including Portugal's property tax structures. My expertise extends to IMI (Imposto Municipal sobre Imóveis) and AIMI (Adicional ao Imposto Municipal sobre Imóveis), focusing on their application, rates, exemptions, and payment schedules.
The IMI in Portugal is an annual tax imposed on urban, rural, and commercial properties, payable by the registered property owner as of December 31 of the relevant year. For instance, the IMI rates for 2020 varied based on property type: urban property had rates between 0.3% to 0.45%, while rural property had a fixed rate of 0.8%. Additionally, properties owned by companies registered in 'blacklisted' jurisdictions incurred a higher rate of 7.5%.
Regarding exemptions, urban properties considered permanent residences could be exempt from IMI for up to three years after acquisition if the property's tax value is under €125,000 and the taxpayer's annual income is below €153,300.
The payment schedule for IMI depended on the tax charge amount: up to €100 was paid in a single installment in May, €100 to €500 in two installments in May and November, and over €500 in three installments in May, August, and November.
On the other hand, AIMI serves as an additional property tax based on the sum of rateable values ('Valor Patrimonial Tributável' or VPT) of all urban properties owned by a taxpayer, irrespective of residency. AIMI bills are issued in July for payment in September.
For individual property owners, AIMI applies if the total VPT equals or exceeds €600,000, or for married/cohabiting couples opting for a joint tax return if the total VPT equals or exceeds €1.2 million. The tax rates for AIMI vary: 0.7% on VPT over €600,000 up to €1 million, 1% on VPT over €1 million up to €2 million, and 1.5% on VPT over €2 million.
Corporate property owners face different rates; they pay an additional 0.4% on the full VPT value. However, if the company is registered in a 'blacklisted jurisdiction,' the AIMI rate jumps to 7.5% on the full VPT value, in addition to the IMI charge of 7.5%.
This comprehensive understanding comes from practical application, continuous study, and staying updated with Portugal's tax legislation and its implications on property owners, both individuals, and companies.
