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  • Writer's pictureJoana Wheeler

How to request the reassessment of IMI to pay less tax?

Updated: Jul 14, 2022

One of the biggest costs in a homeowner's budget is the Municipal Property Tax, or IMI for short. It comprises of a Municipal Tax on the Tax Asset Value (VPT) of urban structures and is targeted at real estate used for residential, commercial, industrial, and building purposes.

The age of the property, its location, and gross construction area, among other things, are some of the elements that affect how much the IMI is worth. It is not much of a surprising that the IMI tables differ based on the property's typology and the municipality to which it belongs.

A reassessment of IMI may be requested, as this may allow you to reduce the amount you must pay, but you must be careful because frequently the amount ends up rising rather than decreasing. We have put together this post to assist you in understanding what affects this Tax and what you should keep in mind prior to submitting a request for a reassessment.

What is an evaluation?

The evaluation is the first step in the process that establishes the Tax Equity Value (Valor Patrimonial Tributário or VPT for short) following the building's completion. The property's location is the subject of a finance service, and its value is established in accordance with six factors:

  • VC - Base value of the finished building (construction price per square meter);

  • A - Gross construction area;

  • Ca - Coefficient of affectation (purpose for which the building is intended);

  • Cl - Location coefficient (characteristics of the surrounding area);

  • Cq - Coefficient of quality and comfort (functionality, convenience of use and enjoyment);

  • Cv - Coefficient of vetustez (age of the property).

What constitutes the update?

The Tax Asset Value (VPT) of real estate is automatically updated by the Finances every three years. This approach almost usually raises the value of the homes based on the currency devaluation coefficients (unless deflation exists). It should be emphasized that this assessment does not take into account all the criteria that were previously analyzed, such as the vetustez coefficients (property age) and the location coefficients, both of which have the potential to reduce a property's value.

What is a revaluation?

Reassessment only takes place in response to a request by the property owner or the City Council. Four of the six previously indicated parameters are once again the focus of the analysis at this point. In this instance, we discuss the vetustez coeficiente (property age), the base value of the constructed building, the location coefficient, and the comfort coefficient.

Consider purchasing a new home three years ago. Instead of paying the IMI associated with a new home (with a vetustez coefficient of 1), you may pay a little less (vetustez coefficient of 0.9). We also want to remind you that you can ask for a free property evaluation every three years. Simply fill out the Modelo 1, which can be downloaded from the Portal das Finanças, and deliver it to the Finance service location area that corresponds to the property's location to obtain it.

Is it worth requesting a reassessment of IMI?

As previously stated, failing to thoroughly analyze the aforementioned issues increases the likelihood that your home's IMI will worsen rather than improve. Before requesting a reassessment, it is advisable to do a comparative analysis of the evolution of the relevant components through time and the building manual (Caderneta Predial).

You can replicate the values for this on a number of websites on the internet. Keep in mind that the parameters should not be examined separately but rather together. This is due to the possibility that the savings you could receive from one of them declining could be countered by the rising of another, ultimately not compensating.

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