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Court Confirms That Taxpayers Can Request Refund of ITBI Overpaid When Tax is Calculated Above the Actual Purchase Price of the Property.
Buying property in Brazil is an expensive dream. In addition to the asset value and loan interest, the buyer faces a series of taxes and fees that increase the costs of the deed and transfer. Among them is the Real Estate Transfer Tax (ITBI), a municipal tax, which generally varies from 2% to 3% of the property value. In recent years, a dispute has reached the courts: after all, what should be the calculation basis for the ITBI? The appraised value used for the property tax (IPTU) or the market value of the transaction? In 2022, the Superior Court of Justice (STJ) decided the issue and paved the way for thousands of taxpayers to request refunds of overpaid amounts.
The Decision of the STJ That Changed the Collection of ITBI
In March 2022, the First Section of the STJ, when judging repetitive appeals, established a historic thesis:
- The calculation basis for ITBI is the market value of the property transferred under normal market conditions, that is, the sale price.
- The appraised value used by the municipality for calculating IPTU cannot be considered as a mandatory minimum for ITBI.
- If the taxpayer pays more than they should, it is possible to request administrative or judicial refund.
In practice, this means that if the municipality assessed a higher value than what was actually paid at the purchase, the buyer had the right to contest. The decision is binding, meaning it must be followed by all courts in the country.
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How It Worked Before and Why There Was So Much Difference
Many municipalities, such as São Paulo, Rio de Janeiro, and Belo Horizonte, adopted their own tables to calculate ITBI, based on “reference appraised value”—almost always higher than the actual market value.
For example: an apartment sold for R$ 500 thousand could have a reference appraised value of R$ 700 thousand, and the ITBI was charged on that amount. If the rate were 3%, the buyer would have to pay R$ 21 thousand in tax, instead of R$ 15 thousand, that is, R$ 6 thousand more.
This system, criticized by lawyers and consumer associations, was considered an abusive form of revenue collection. With the STJ decision, the buyer pays only on what was actually negotiated in the deed.
The Impact on Property Buyers
The decision brought financial relief to those buying property, especially in large urban centers. Additionally, it opened the door for thousands of refund actions across the country.
According to tax experts, the refund can reach significant amounts, depending on the purchase history:
- Recent buyers can request administrative refund directly from the municipality.
- Older buyers can take the matter to court, but must respect the five-year deadline to contest paid taxes.
In some cases, taxpayers have managed to recover amounts exceeding R$ 50 thousand in ITBI charged above the due amount.
How to Request Refund of ITBI Overpaid
The procedure varies from city to city, but generally, the buyer should:
- Gather the documents: public deed of purchase and sale, proof of ITBI payment, and collection guide.
- File the administrative request: with the Municipal Finance Secretariat.
- Wait for a response: if the request is denied, it is possible to appeal to the courts.
Lawyers specializing in tax law warn that, in some municipalities, the administrative refund is hindered, making judicial action inevitable.
The Impact on Municipal Finances
For municipalities, the decision represented a challenge. ITBI is one of the main sources of own revenue, especially in capitals where the real estate market is booming.
Associations of municipalities warned of a possible decline in revenue. On the other hand, experts point out that the decision merely corrected a distortion: charging above the actual value of the property violated the principle of contributory capacity and constituted indirect double taxation.
Precedents and Established Jurisprudence
Since the 2022 decision, various state courts have begun to follow the STJ’s understanding. In São Paulo, taxpayers have already obtained favorable decisions to recover overpaid amounts.
In Belo Horizonte, an emblematic case involved a buyer who paid ITBI on an appraised value much higher than the contract price and successfully obtained a judicial refund.
The trend is for jurisprudence to become increasingly consolidated, opening the way for new requests.
ITBI and Consumer Rights
Lawyers remind us that the decision also strengthens consumer rights. The property buyer is the more vulnerable party in the relationship with the municipality and cannot be forced to pay tax on an arbitrary value, unrelated to market reality.
The victory in the STJ is seen as a way to balance the power relationship and ensure greater transparency in tax collection.
ITBI and Property Purchases in 2025
With the real estate market booming and prices still high, the decision regarding ITBI takes on even more importance. Those buying property in 2025 should stay alert:
- Check if the value used to calculate ITBI is the market value of the transaction.
- If it is higher, file a revision request before paying.
- If you have already paid, consider submitting a refund request.
The decision could mean immediate savings on the deed and even recovery of significant amounts already paid.
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