Brazil's IBS and CBS reform and real estate sales

What is in force and what comes later

The reform is in transition, and the dates above come from the consolidated text of the Câmara dos Deputados, which does not replace the Official Gazette. Any later change would have to be published as a law before it became a rule.

Which real estate operations are covered

Article 252 of LC 214/2025 applies IBS and CBS, under a specific regime, to the sale of real estate (including through an incorporation or a land subdivision), the transfer of real rights for consideration, rental and similar transfers, administration and intermediation services, and construction services. They do not apply to a swap of properties, except for the cash balance (torna; art. 252, paragraph 2, item I, in the wording of LC 227/2026), nor to the creation or transfer of security rights such as a mortgage (item II).

When an individual is a taxpayer

An individual is a taxpayer of the regular regime, and so subject to this chapter, only in the cases in article 251, paragraph 1:

1. Rental: gross receipts above R$ 240,000 in the previous calendar year and more than three distinct properties.
2. Sales: more than three distinct properties sold in the previous year, counting properties held less than five years (paragraph 3).
3. Self-built property: sale of more than one property built by the seller in the previous five years.

During the current year, an individual becomes a taxpayer if they exceed the sale limits, or if rental receipts exceed the R$ 240,000 ceiling by 20% (paragraph 2). The R$ 240,000 figure is indexed monthly by the IPCA (paragraph 5). The regulation defines what counts as a “distinct property” (paragraph 6). Consequently, an owner who sells one home is not caught by these limits. Short-term residential rentals of up to 90 days by a taxpayer follow the hotel rules (art. 253).

Reductions for those who are taxpayers

For taxpayers, the specific regime reduces rates by 50% for real estate operations and by 70% for rentals (art. 261). Three deductions exist:

• Adjustment reducer (arts. 257 and 258): from 1 January 2027, each property of a regular-regime taxpayer carries a value, based on its acquisition value updated, or its reference value, as of 31 December 2026. It reduces the tax base on a later sale and includes the transfer tax (ITBI) and laudêmio paid on acquisition.
• Social reducer for sales (art. 259): R$ 100,000 per new residential unit and R$ 30,000 per residential lot, indexed monthly by the IPCA.
• Social reducer for residential rentals (art. 260, in the wording of LC 227/2026): R$ 600 per month per property.

In a judicial auction, article 263 names the buyer (adquirente) as taxpayer of the operation. See buying at a property auction.

What stays the same

The 2026 test year and the specific regime do not alter the capital gains tax on an individual’s sale of property, described in capital gains tax on property. The text read treats the ITBI transfer tax and laudêmio paid on acquisition as part of the adjustment reducer (art. 258, paragraph 6). Non-residents are covered by their own guide, non-resident capital gains tax, with Receita Q&A 655 stating that resident exemptions do not apply to them.

Which professional to consult

An accountant can tell whether a seller or landlord is above the thresholds, and a lawyer registered with the OAB can review fixed-term rental contracts signed before the law, for which article 487 offers an option to pay on gross receipts received (3.65% in the wording of LC 227/2026). For sale mechanics, see selling a home in Brazil.