IMT exemption for young people: Until when can they benefit?

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These three situations can cause young people to lose the exemption from IMT.

Young people who will have access to the exemption from the Municipal Tax on Onerous Real Estate Transactions (IMT) can only benefit from the measure if they meet certain factors.

There are three situations in which young people cannot fail if they want to maintain the benefit, according to the bill sent to Parliament by the Government, as explained by Notícias ao Minuto.  

So that they can continue to access the exemption, young people must maintain housing as permanent for six years, not change the household or change the workplace  .

At stake is the granting of IMT exemption (as well as Stamp Duty) to individuals between 18 and 35 years of age for the purchase of their first home, which must be exclusively for own and permanent housing, who are not owners of any property on the date, nor in the previous three years, and are not considered dependents for income tax purposes.

Access to full exemption applies to properties with a value up to the 4th bracket of the IMT table (up to 316,772 euros) and partial exemption for properties valued between 316,772 euros and 633,453 euros.

So, the established law determines that young people stop benefiting from the exemption/reduction of IMT fees "when the property is given a different purpose than the one on which the benefit was based, within six years from the date of acquisition, except in the case of sale," as stated in the news article.

In addition, the benefit "Due to marriage or de facto union, dissolution of marriage or de facto union or increase in the number of dependents" is removed, as well as "change of workplace to a distance exceeding 100 km from the building" as long as, in both cases, "the building remains exclusively allocated for housing", it also reads.

The Government's proposal also includes the request for authorization to create a compensation mechanism aimed at municipalities that see their revenues decreased by the application of the exemption in question, so that "no municipality is harmed". Therefore, the Tax and Customs Authority (AT) will inform the Directorate-General for Local Authorities "of the amounts of lost revenue", so that subsequent transfers to municipalities are "made monthly," the news makes clear.

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