The
legal regulations are very specific when buying
a property in Portugal, however, it is always
advisable to use qualified legal advice
or a qualified estate agent in any transaction.
It is also important to insure that any plans
in the Town hall referring specifically to the
property do physically agree with the existing
construction.
- A habitation licence for property constructed
after 1951 or a certificate that the property
was in existence from before 1951;
- A
certified insertion in the records of the Land
Conservatory;
-
A detailed "Caderneta Urbana" from
the Tax Office;
2-
A certified insertion in the records of the Land
Conservatory
3-
A detailed "Caderneta Urbana" from
the Tax Office
..In
the case of a rural property the following extra
documentation is necessary:
4- A detailed "Caderneta Rustica" from
the Tax Office.
Each
Town hall and Tax Office tend to have local interpretations
of the laws and regulations and these should
be first checked. It is often very necessary
to implement specific searches prior to acquiring
a rural property.
There
are some laws regulating Estate Agency practices
and each must have a Licence granted by the State.
The seller of a property normally pays commissions
but it is not a controlled percentage and it
is sometimes agreed upon by the leading Estate
Agents in each area.
Here
are the basic steps to help understand the procedures
and legal acts that are involved in acquiring
a property in Portugal.
It is recommended that qualified legal advice
be sought in any purchase.
1- Only use a Government Licensed Estate Agent.
2-
It is quite normal for both Parties to initially
enter into a Promissory Contract detailing
the conditions of Sale - "Contrato de Promessa
de Compra e Venda". This Contract is then
legalised by registering it in the Notary Office.
This Contract is legally binding on both sides
and the law requires the seller to repay twice
the deposit should he withdraw from the sale.
Likewise, it the buyer fails to complete he
forfeits the total of his deposit. There are
specific laws on this act that a Lawyer will
define.
3-
It is often convenient for the buyer to ask
a third party who he trusts and speaks the
language to act for them in the matter. A
document called "Procuração Pública" is
prepared with the necessary details and registered
in the Notary. This can also be implemented
in Portuguese Consul in a foreign country
or by your local Notary after which translation
into the Portuguese language can be done.
4-
Every buyer is required to obtain from the
Tax Office (Finanças), a fiscal number.
5- Prior
to act of completion, the purchase may be subject
to a payment called "Sisa" to the
Tax Office. Depending upon the nature of the
purchase the amount can vary. In the case of
residential properties the "Tabela de Cálculo
de Sisa" in force for 1998 (this table
is normally subject to annual change), is as
shown in the table below. In the case of rural
(Rustico) properties the calculation is at
present 8% regardless of its value.
|
up
to 11.400..000$00
|
0
%
|
0
|
|
11.400.000$00
to 15.620.000$00
|
5
%
|
570.000$00
|
|
15.620.000$00
to 20.820.000$00
|
11
%
|
1
507.200$00
|
|
20.820.000$00
to 26.020.00$00
|
18%
|
2.964.600$00
|
|
26.020.000$00
to 31.520.000$00
|
26%
|
5.046.200$00
|
|
above
31.520.000$00
|
Unique
Tax
|
10%
|
[ Please note that these prices and subject to
19% VTA -2002 ]
An
example:
Suppose
a property will cost 22.500.000. Multiply this
figure by 18% = 4.050.000$00 , then deduct 2.847.500$00.
Total tax to be paid 1.202.500$00
When
all the above requirements have been completed
the sale can proceed with the act known as "Escritura
de Compra e Venda" which takes place in front
of the selected Notary and is recorded in his
official books. It is at this time that the balance
of purchase has to be made according to the signed
Contract in Point 2 above. The Notary Office then
issues normally a few days later a photocopy of
the entry of this act which should not be mistaken
for a "Title Deed" as known in the
UK.
On proof of the above act the property in question
is then registered in the Land Registry (Conservatória
do Registo Predial), in the new owners name.
It is not obligatory for this to be don until
the owner wishes to sell the property, however,
it is strongly recommended that this registration
is made immediately as a preventative measure
against possible financial abuse by the previous
owner.
Consequently all utilities like water, telephone,
electricity have to be altered into the name of
the new owner.
On
top of the local taxes (Sisa) as mentioned
above one should take allow for the following
additional costs:
1-
Notary fees Approx. 1,25% of the value mentioned
in the escritura
2- Registration feesApprox. 0,75 % of the value
3- Legal feesNormally between 1-4 % of the value,
this depending on the complexity of the case and
the person used to represent you.
4- Changing utilitiesDepending but somewhere between
25.000 and 50.000$00
|
