Law No. 35/2024, of August 7th - Local Accommodation

In brief

Law No. 35/2024, published on 7 August, authorises the Government to revoke the extraordinary contribution on properties used for local accommodation and the ageing coefficient applicable to local accommodation establishments for the purposes of calculating the Real Estate Municipal Tax. Additionally, it aims to eliminate tax obstacles to geographic mobility for work reasons.

Detail

The publication of the aforementioned authorization law will enable the Government to implement the following legislative changes:

• Repeal, with effect from December 31, 2023, the extraordinary contribution on local accommodation, originally introduced by the More Housing Program (Law No. 56/2023, of October 6);

• Repeal, with effect from December 31, 2023,the ageing coefficient applicable to local accommodation establishments for the purposes of IMI settlement; 

• Regarding the conditions for exclusion from taxation of capital gains arising from the onerous transfer of properties intended for the taxpayer's or his family's own and permanent housing: 

  • Reduce the period for allocation to own and permanent housing from 24 months to 12 months prior to the date of transfer, or, if earlier, the date of reinvestment. Exceptions apply if this period is not observed due to exceptional circumstances, such as changes in the composition of the family household (marriage, de facto union, dissolution of marriage or de facto union, or increase in the number of dependents) and labour mobility.

  • Repeal the condition that disallowed taxpayers from benefiting from the taxation exclusion if they had already benefited from it in the year the capital gains were obtained and in the three previous years.

• Create a PIT deduction for property income arising from a housing rental contract, corresponding to the expenses incurred by the taxpayer for the payment of rent for property allocated to their own permanent home, in situations where the domicile is changed to a location more than 100 km away.

^{© 2024 PwC. This communication is of an informative nature and intended for general purposes only. It does not address any particular person or entity nor does it relate to any specific situation or circumstance. PricewaterhouseCoopers Tax Services TLS, Lda. We will not accept any responsibility arising from reliance on information hereby transmitted, which is not intended to be a substitute for specific professional business advice.}