Real estate capital gains: There are two current regimes.
This year, there are two diplomas in force regarding real estate capital gains, depending on the date of sale of the property. Understand the differences.
Since September 11, two regimes have been in force in the application of capital gains.
There are now new rules to benefit from the IRS exemption on capital gains in the sale of houses as of September 11th.
The new diploma allows the purchase and sale of permanent housing within one year instead of two. Without retroactive effects, two regimes for applying the exemption of capital gains tax will be in effect.
This new regime has already been published in the Official Gazette, by Decree-Law No. 57/2024, and will allow for easier geographic mobility of families.
This means that, depending on the date of sale, one of these two regimes may apply:
- Until September 10, 2024: The regime applies in which the minimum time between the sale of the main home and the purchase of a new property for the same purpose is 24 months. Only those who have not done so in the previous three years can access the exemption of the IRS on the respective capital gains from the sale of the house.
- Starting from September 11, 2024: The new tax regime applies where the time between the sale of the primary and permanent home and the purchase of a new home for the same purpose becomes 12 months. You can use this regime more than once, even if you have already benefited.
In other words, the sale date of the house will ultimately determine the applicable legal framework, impacting the IRS declaration for the following year. This means that those who sell the property by September 10th need to have lived in it for at least two years to be exempt from IRS on real estate capital gains, and those who sell the house from September 11th onwards only need to have lived in it for one year to benefit from the exemption.
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