In accordance with the provisions of article 45 of the Tax Benefits Statute (EBF), the buildings or units located in urban rehabilitation areas or completed more than 30 years ago benefit from the incentives set forth for in this rule – namely the Municipal Real Estate Transfer Tax (“IMT”) exemption – provided that, cumulatively, they are subject to building rehabilitation interventions and, as a result of the intervention, the respective state of conservation is two levels above the previously granted and has at least a good one.
The tax benefit in terms of IMT does not prejudice the assessment and collection under the general terms, i.e. the tax is also charged, but if after completion of the works, the legal requirements are met, the amount is refunded.
The city council is responsible for the recognition of the rehabilitation intervention and for communicating to the competent tax department that the conditions for the purposes of a tax reimbursement have been satisfied.
Under the above-mentioned legislation the process to get the reimbursement is as follows:
- At the time of the prior notice or license application for the urban development operation, a recognition of the rehabilitation intervention shall be requested for IMT exemption purposes, under the terms of Article 45 of the Tax Benefits Statute;
- With the conclusion of the rehabilitation works, an independent inspection shall be requested, in order to prove the compliance with the requirements established in the referred legal clauses;
- The result of this inspection shall be sent to the City Council or to the managing entity of the urban rehabilitation;
- The City Council or managing entity shall be communicate that acknowledgment to the competent Tax Department within 20 days from the date of determination of the conservation status resulting from the works or from the issue of the energy certificate, if later;
- Within a maximum period of 15 days after the communication, the above-mentioned Tax Department will cancel the IMT assessments and make the corresponding reimbursements to the owners.
IAS would point out that that, although the procedure is subject to the above deadlines, in practice they are only indicative and there may be delays both in the inspections carried out by the municipalities and in the communications between these same municipalities and the competent tax departments.
For further information, kindly contact IAS team.