Sell a house in 2023: How much do I pay in capital gains tax in 2024?

Didn't sell, but want to sell? Talk to a real estate consultant from the agency Casa no Minuto and sell your property now! But read how much you will pay in real estate capital gains this year.

What are the cases exempt from capital gains taxation?  

If you have sold a house in 2023, this year you may have to pay capital gains taxes on that sale. This happens when the sale value is higher than the purchase price of the property. In this case, the taxation is done in the IRS, according to the current tax brackets.

But not all capital gains are subject to tax: So, if you bought the house (which you now sold) before January 1, 1989, the respective capital gains are not taxed.

Note also that there is currently a law in force that allows for the exemption from taxation of capital gains related to the sale of houses between January 1, 2022 and December 31, 2024. However, this is subject to two requirements: the value gained from the sale, after being directed to the amortization of the housing loan of the sold property, must be applied to the amortization of another housing loan - for own and permanent purpose, either for oneself or a family member – with this application being made within three months after the sale.

However, you can also be exempt from taxation when selling a permanent own housing property whose sales value is directed towards the purchase of another property with the same purpose, within 24 months prior or 36 months after the sale.

And finally, you are also entitled to exemption if you are over 65 years old or retired, having to invest the amount from the sale in an insurance contract, for example, a retirement savings plan, in a pension fund or in contribution to the public capitalization regime.

It is worth noting that the exemption corresponds to the amount invested - if you invest the total amount, you have full exemption, but if you invest part of the amount, the exemption is proportional to that part.

How do I calculate the capital gains from the property I sold?

Capital gains taxation in IRS is calculated by consolidation, as they are added to the rest of the annual income (thus only taxed in the year following the sale). Therefore, there is no specific rate.

As a rule, only 50% of the capital gains are taxed, but there are exceptions. Properties that benefited from non-refundable public support for acquisition, construction, reconstruction, or conservation works with a value exceeding 30% of the Taxable Asset Value (VPT) and are sold before 10 years are subject to taxation of 100% of the capital gains.  

The formula that determines the taxable value is:  

Value of realization/sale - (acquisition value x currency depreciation coefficient) - (costs with acquisition and sale + expenses with property appreciation in the last 5 years)

Illustrating, considering a house bought in 2008 for 180 thousand euros, sold in 2023 for 270 thousand euros and the owner had a cost of 17 thousand euros in expenses, the capital gains are:

37,000 euros - (180,000 x 1.20) - 17,000

Considering that, in this case, only 50% of this amount is taxed, namely 18,500 euros. This is the value of real estate capital gains with the purchase of the house subject to taxation.  

I will sell a house in 2024: How to get the best deal?

Looking to sell a house this year? Getting the best deal requires experience and analysis, which can be obtained through a real estate agency.

Real estate consultants put your property on the market, help with property viewings, advise on the best offer, assist with gathering all the paperwork, and with the entire sales process until the deed.

At the real estate agency Casa no Minuto, you have access to this through a close, fast, and personalized process. Contact us and sell your house quickly in 2024!

If you still need funding for a new property or another project, know that credit intermediaries from Poupança no Minuto offer a free mediation service to contract your credit.