Municipal Property Tax - IMI
IMI (Imposto Municipal sobre Imoveis) is payable annually by any owner of property in Portugal and is calculated on the basis of the property's rateable value - Valor Patrimonial Tributario. This is calculated by the tax authorities and may bear little obvious relationship to the property's actual market value. IMI is a local tax so can vary from district to district, much as in the UK.
The VPT, or rateable value, is calculated according to a formula which takes acoount of the size, age, cost of construction and use of the property and then applies various coefficients relating to the percieved quality and comfort of the building and its location - rural/town/seaside/ etc.
Generally, according to the IMI code, the VPT should be between 70% and 80% of the market value but given the number of variables in the calculation this should be taken as a rough guide only.
As the rates are set annually by each town hall they can vary but a purchaser of property in Portugal should expect to pay between 0.4% and 0.8% for urban properties and 0.8% for rural ones. Again, purchasers of Portuguese properties are advised to consult their solicitors or other advisors to obtain the latest tax rates relating to their property.
Payment of IMI
Unless the IMI to be paid is lower than €250 it will be payable in two equal instalments in April and September each year. Your fiscal representative will receive notification of the amount due or will request one if one is not received. IMI has to be paid on time to avoid potential interest charges on unpaid sums.
As all town halls, utilities providers and anyone else involved in contracts to do with properties (banks, lawyers, etc) are required to obtain registration certificates from the tax authorities they tend to have fairly comprehensive data on properties and transactions. This enables them very effectively to adjust the IMI and/or VPT regularly and effectively.
