Property CPF: what is it and how does it work?
Brazil has more than 5,000 municipalities. All of them register important information about their properties in specific registry offices in their cities. The problem is that these institutions do not talk to each other. To solve this challenge, the concept of “Property Tax ID” was created.
This term, in fact, is a kind of nickname for Decree 8.764, of 2016, whose objectives were to meet society’s demand to organize property records and offer more legal certainty to the market.
In order for you to understand what the CPF of the Property is and what it changes in the way these properties are marketed, we recommend reading this article carefully. Come on?
Is the CPF of the property more of a bureaucracy?
The Brazilian has an aversion to bureaucracies – and with good reason. According to a report released by the World Bank, our country is the most bureaucratic in the world. This means that many markets, such as real estate, are hampered by this need to issue so many documents.
A person can give up on a purchase when he realizes that he will have to register his property, for example. Therefore, it is important to clarify that the CPF of the property is not a measure that comes to hamper these commercial transactions.
In fact, this is a new work process that will be commanded by the IRS. The idea is that it is carried out automatically and at no cost to the taxpayer.
For this, the government created the National Territorial Information Management System (Sinter), which will collect this information and transfer it to the IRS.
In this way, notary offices will send an electronic record to Sinter whenever a notary change is made to the property. Information such as transfer of ownership, payment of IPTU, financing, among others, will be reported to the revenue.
Will the CPF of the Property replace the registration?
This is a common question among people. We must make it clear that this will not happen, because the CPF of the property is not a new document or even a new real estate registry.
It is only a matter of integrating information exchange between notaries through a government system. In practice, in the daily lives of those who buy or sell real estate, it will not change much.
The obligations that already exist – such as payment of ITBI, documents that must be presented when seeking financing and registration of the property, for example – remain the same.
Why is this measure important?
Firstly, because it brings security to the real estate market, since there is a modernization in the organization and recording of this data. In a huge country, like Brazil, it has always been complicated to make notaries get to share data.
In the past, when these records were made only on paper, for example, there was a very high risk that this information would be lost – or even tampered with.
Therefore, any modernization initiative in this regard can help to make property purchases and sales safer.
Combating tax evasion
These records will also help the government to combat tax fraud. From the simplest, like a person who did not pay IPTU because their house did not reach the minimum footage to be taxed, to someone who did not declare ownership of a property.
According to data from the National Confederation of Shopkeepers (CNDL), in 2018 alone, our country failed to collect more than R $ 345 billion due to tax evasion.
In addition to protecting data that will be used by the judiciary, in the event of legal disputes involving the property, the correct storage of this information contributes to meeting the rights of people seeking compensation in court.
In many cases, a citizen’s property goes up for auction so that he can pay damages if he is defeated in a lawsuit. However, without having access to all the assets of a person, being held hostage only to what he declares in his Income Tax (IR), the judiciary may erroneously conclude that the loser does not have enough assets to pay the compensation – mainly if your real estate properties are in inland cities or if they are not properly registered.
This practice brings legal uncertainty to the proceedings, since lawyers and prosecutors do not have access to important data, such as the real estate of a person who is being accused of a financial crime.
Information about Brazilian lands
It is no secret that our country suffers from a housing deficit, with occupations of environmental reserves and private properties.
The CPF of the property will help to understand the entire history of a land, checking if it is in good standing and what can be done to solve possible irregularities.
In addition, the data will give government officials an overview of the challenges facing the furniture sector, such as access by certain segments of the population to credit lines.
In many cities, this data may serve to understand the profile of the buyer of real estate, contributing to changes in legislation.
Has the change already been completed?
It has been initiated, but it is far from complete. Many municipalities do not charge IPTU and the collection of data that will be used to make the CPF of the property begins with the work of the municipal governments.
This means that it will first be up to the cities to organize themselves to provide this data to the federal government. Immediately, little changes in the daily lives of those who are thinking of buying a house, land or apartment.
In the first half of 2019, the Colégio Notarial do Brasil (CNB) issued a note to clarify to the notaries that they are not yet required to send this information to Sinter.
This shows that this issue still raises doubts, even among the bodies responsible for registering properties.
As we have seen, the property’s CPF is an attempt to organize information about Brazilian properties. Something understandable, since we live in a period when many technological solutions use data. However, immediately, this initiative has no impact on property purchases.