The Tax on the Transfer of Real Estate (ITBI) is a tax of great controversy as to its generating fact in different situations. One of the controversial issues is the collection made by municipalities on real estate payment operations in real estate investment funds (FII), a topic not yet pacified by the Brazilian courts.

The discussion whether or not there should be payment of ITBI in these transactions occurs mainly because it is a municipal tax. This causes the rules for collection to vary according to the location of the property paid.

In February of this year, in a judgment held in the records of AREsp 1,492,971, the 1st Panel of the Superior Court of Justice (STJ) confirmed the understanding of the Court of Justice of São Paulo (TJ/SP) and determined the payment of ITBI in operations of this nature.

In the judgment, the understanding that prevailed among the Justices who are members of the 1st Panel of the STJ that "the acquisition of real estate for the equity of the real estate investment fund, operationalized by the issuance of new quotas of the condominium and effected directly by the administrator of the fund, configures, to all evidence, transfer for consideration of immovable property, characterizing the fact that generates the ITBI (...)".

In the case that gave rise to the judgment, a company that manages FIIs filed a writ of mandamus against the municipality of São Paulo, alleging illegality in the collection of the ITBI on the operation of payment of the real estate to the assets of the FII.

According to the administrator, the transferred fiduciary property should be considered only a security right. Thus, it would be immune to the collection of the ITBI, according to what is established by the Federal Constitution (CF) in its article 156, item II.[1] The administrator also claimed that the transfer of the property to the assets of the FII would not constitute a transfer of ownership, since the fund does not have legal personality.

The judgment, therefore, revolved around two legal grounds:

  • the existence of tax immunity on the right in rem of guarantee (Article 156, II, of the CF); and
  • the absence of transfer of ownership of the property in its payment to the FII, since the fund cannot be the holder of rights and obligations because it does not have legal personality (Article 35, II, of the National Tax Code).

The judge in the case rejected the administrator's requests, as he interpreted that the former owners no longer had a direct relationship that allowed them to exercise rights over the properties and received in return the social quotas of the FII. There would have been a costly transfer of ownership, an operation subject to the ITBI.

The magistrate understood that the paid-up property became the property of the FII, even if the registration is formally made in the name of the administrator of the FII, as a fiduciary owner, since the FII has the legal nature of a closed condominium and does not enjoy legal personality.

This understanding was maintained by the São Paulo Court of Appeals, which led to the filing of a special appeal to the STJ.

Issue may end up being analyzed in the Supreme Court

Although there is an infraconstitutional aspect in the discussion about the ITBI generating fact in the payment of real estate to the FII patrimony, it is undeniable that there is also a constitutional aspect in relation to the existence or not of tax immunity in this operation. With this, it is possible that the issue will be examined by the Federal Supreme Court (STF).

In May, inclusive, the issue was presented in the Supreme Court. In a monocratic decision in Case 1,434,753, Justice Rosa Weber denied the follow-up to an extraordinary appeal that dealt precisely with the tax immunity of Article 156, II, of the CF in the payment of real estate in FII.

The decision, however, was made for strictly procedural reasons. With this, the Justice did not come to address the merits of the issue.

Another discussion revolves around the collection of ITBI in the change of the FII administrator. That is, to record the change of administrator – transfer of fiduciary property – in the real estate registry, characterizes ITBI taxable event?

We believe not, because, as provided for in article 11, paragraph 4, of Law 8,668/93, the succession of the administrator constitutes only a transfer of fiduciary property for the purpose of managing the fund's assets. The operation does not generate a transfer of ownership.

If this issue is taken to the Judiciary, it will be necessary to analyze whether the position of the 1st Panel of the STJ in AREsp 1,492,971 will influence the judge's assessment of the possibility of charging ITBI in cases of mere change of administrator of the FII, even if they are legally different situations.

There are already decisions that recognize that the succession of the fiduciary property of real estate that is part of the FII patrimony does not constitute a transfer of ownership (REsp 1.521.383/RS).

About all this discussion, we understand that, in the future, operations involving the payment of real estate in FII will probably be taxed by the competent municipality. The ITBI will be calculated based on the value of the properties transferred and may reach up to 5% of the value of the property, depending on the rate applied by the municipality in which the property is located.

It is essential, therefore, that, before carrying out the operation, the municipal legislation is analyzed to verify the hypotheses of incidence of ITBI and the value of any charges. Thus, it will be possible to define the most efficient structure, considering various business and legal aspects – including tax.

There is also another point that deserves attention: the changes brought about by the new regulatory framework for investment funds (CVM Resolution 175/22). Established by the Brazilian Securities and Exchange Commission (CVM), the framework should enter into force on October 2 of this year and the changes may generate new discussions about the incidence of ITBI in operations involving FIIs.


[1] Constitution. Art. 156 [...] II – transmission "intervivos", in any capacity, by means of a onerous act, of immovable property, by nature or physical accession, and of rights in rem over immovable property, except those of guarantee, as well as assignment of rights to its acquisition.