Real estate appreciation in 2024: calculation and tax exemption.

What are the tax benefits of selling a primary residence? Secondary? And land? Before you sell your property, it is best to know how much tax you will have to pay. Although the income from the sale of real estate is usually taxable, there are possible benefits. Settlement, non-resident, inheritance, division, simulation, .... Everything you need to know.

Income from sale of real estate

Income from the sale of real estate is in principle taxable. However, there are exemptions that are granted depending on the nature of the property (e.g. main residence) or the personal situation of the seller. The tax treatment of real estate gains tax has undergone several changes in recent years.

What is the amount of increase in real estate value?

The gross increase in value corresponds to the difference between the sale price of the property and its acquisition cost.

Rough Incremental Value = Selling Price - Acquisition Price
The sale price is simply the sale price: increased by the payments and compensation paid by the buyer and stipulated in the notarized contract, less expenses incurred in the sale (e.g. related to mandatory diagnostic work), provided you can prove them, Less the amount of VAT paid (also requires proof).
The purchase price, in turn, indicates the price at which the seller purchased the property: increased by the fees and compensation paid to the owner at purchase, Increased by the acquisition costs: registration fees or VAT paid at purchase, notary fees ...

If the seller cannot provide documents, he may apply a forfeit increase equal to 7.5% of the acquisition cost. If the property was acquired free of charge, that is, as part of an inheritance or gift, these acquisition costs increase the market value indicated in the contract, Increased by the costs incurred as part of works (construction, reconstruction, extension or improvement), provided it is possible to prove their cost, which requires invoices issued by the companies that carried out these works. In case she cannot find these invoices, the person selling the property can still increase the acquisition cost by 15% if she has been the owner for more than 5 years, Increased for road expenses, grid connection and distribution. Note, when paying with a life annuity, the capital value of the annuity is taken into account. Purchase price = Purchase price + Expenses incurred on purchase + Registration fees + Work expenses + Travel expenses

Change in share for capital gains tax on real estate

In fact, it is necessary to calculate two net profits: the one that will be subject to income tax (a tax rate of 19%) and the net profit subject to social contributions (a tax rate of 17.2%). To obtain both values, it is enough to subtract the holding period discount from the gross profit amount.

Net profit = Gross profit - Discount
Taxable net income

Starting from February 1, 2012, a holding period discount applies to income tax as follows:

6% for each year of ownership from the 5th to the 21st year.
4% for each year of ownership starting from the 22nd year.

Discount for the holding period for income tax:

Period of ownership	Discount
From 0 to 5 years old	0%
6 years	6%
7 years	12%
8 years	18%
9 years	24%
10 years	30%
11 years	36%
12 years	42%
13 years	48%
14 years	54%
15 years	60%
16 years old	66%
17 years old	72%
18 years old	78%
19 years old	84%
20 years	90%
21 years old	96%
22 years old	100%

Full exemption from capital gains tax on real estate is achieved after a 22-year ownership period, instead of the previous 30 years.

Net profit subject to insurance contributions:

Discount for the duration of ownership for insurance fees:

Period of ownership	Discount percentage
Up to 5 years of ownership	0%
6th year	1.65%
7th year	3.30%
8th year	4.95%
9th year	6.60%
10th year	8.25%
11th year	9.90%
12th year	11.55%
13th year	13.20%
2014	14.85%
15th year	16.50%
2016	18.15%
Year 17	19.80%
Year 18	21.45%
Year 19	23.10%
Year 20	24.75%
21st year	26.40%
Year 22	28%
Year 23	37%
24th year	46%
25th year	55%
26th year	64%
27th year	73%
28th year	82%
29th year	91%
30th year	100%

Full exemption from capital gains tax on real estate is achieved after a 30-year ownership period.

Exception. Tax benefits on the capital gains from the sale of certain constructed buildings.

For the sale of constructed buildings completed between September 1, 2014, and December 31, 2016, an additional discount of 25% is applied to the amount of each net profit, that is, after deducting the holding period discount (provided that a preliminary agreement was made in 2015 for transactions completed between January 1, 2015, and December 31, 2016).