Is the VPT the market value?

No. The VPT (valor patrimonial tributário) is the tax value of a property under the CIMI. For urban housing, commerce, industry and services it comes from the formula in article 38, not from a market judgement. Market value under the IVS and the Red Book is an estimate of the price in an arm’s-length exchange on a stated date.

How is the VPT calculated?

The CIMI says the VPT is determined under that Code (article 7). For urban housing, commerce, industry and services, article 38 gives the formula Vt = Vc × A × Ca × Cl × Cq × Cv (base value, areas, and coefficients for use, location, quality and comfort, and age), rounded up to the next ten euros. For rural property, article 17 sets the VPT at 20 times the cadastral income. IMI is levied on the VPT (article 1).

Where else is the VPT used?

IMT is charged on the higher of the contract price and the VPT (CIMT, article 12). Stamp duty on gifts and inheritances uses the VPT at the date of the transfer (Stamp Duty Code, article 13). The figure appears on the caderneta predial. I regularly see buyers treat it as if it were the price the property would fetch; it is not.

Does the CIMI itself distinguish VPT from market value?

Yes. Article 76(5) treats the VPT as distorted when it is more than 15% above or below the normal market value, and a second tax evaluation can then be requested. The Code itself treats the two figures as different. See Market value is not price and Market value under IVS.

Is the VPT the market value?

Is the VPT the market value?

How is the VPT calculated?

Where else is the VPT used?

Does the CIMI itself distinguish VPT from market value?

Read next

José Covas FRICS — about the author

Sources