From this Tuesday (24) until December 16, taxpayers will be able to update the value of the property in the Income Tax declaration in exchange for immediate payment of the tax with reduced rates. The Federal Revenue published a normative instruction which regulates the possibility, authorized by Law 14.973which established the gradual re-taxation of payroll taxes until 2027.
Until now, the law did not allow the updating of the purchase value of properties in the Income Tax return, except in cases of duly proven renovations and expansions. The new law allows the updating of the value in the return, collecting the tax on the gain in value in advance, with reduced rates.
The measure benefits both individuals and companies, but is only advantageous for those who intend to sell the property in the medium and long term. For individuals, a 4% income tax rate will be applied to the difference between the purchase price of the property and the updated value. Companies will pay 6% corporate income tax (IRPJ) and 4% social contribution on net income (CSLL).
Currently, individuals pay 15% to 22.5% in income tax on capital gains (appreciation of the asset over time) when selling a property. Legal entities generally pay 15% in IRPJ and 9% in CSLL, totaling 24%, but the sum of the two taxes can reach 34%, depending on the company’s tax regime.
Deduction
The rates charged on the sale of the property have not changed. However, the IRS will allow those who updated the value of the property in their tax return to deduct, from the tax base, the difference between the updated amount and the amount before the update. This results in the payment of less taxes for those who took advantage of the benefit.
Anyone who sells the property up to three years after the update will not be able to deduct anything. From the fourth year onwards, the amount to be discounted increases by eight percentage points per year on the difference between the updated value and the value before the update, until it reaches 100% after 15 years. Only from the 16th year onwards will the deduction be total. In practice, the benefit will only be available to those who change property from the ninth or tenth year after the update.
Procedure
Those interested in updating the value of the property in the declaration must present the Declaration of Option for Updating Real Estate (Dabim). The document is available from this Tuesday at Virtual Service Center (e-CAC) of the Federal Revenue Service.
The 2025 budget bill, sent to Congress at the end of August, does not estimate how much the government can raise by anticipating taxes. According to the government, it was not possible to make the calculations because the impact on federal coffers would depend on the speed of the economic team in regulating the measure.
