ITCMD in São Paulo: what is the rate, who is exempt and how to calculate the inheritance and gift tax?
ITCMD in São Paulo: the 4% rate (with progressivity still pending), UFESP exemptions, tax base, payment in installments and how to pay the inheritance and gift tax.
The ITCMD is the state inheritance and gift tax on inheritances and gifts, paid by whoever receives. In São Paulo, the rate remains fixed at 4% (Law 10.705/2000). The Tax Reform made progressive rates mandatory (up to 8%), but this depends on a state law that has not yet been enacted — so, today, the 4% rate applies. There are UFESP exemptions, and the tax can be paid in installments.
Need help with your case? Talk to a probate lawyer in São Paulo.
When someone receives an inheritance or a gift, almost always the same question arises: how much tax will I pay? That tax is the ITCMD, and it is usually the largest cost of a probate (inventário) — often larger than court costs and fees. Understanding how much it is, who is exempt and when to pay avoids surprises and penalties, and helps with planning.
There is also a reason for urgency: the ITCMD landscape is changing across the country, and São Paulo is at the center of that change. Knowing what applies today — and what may change tomorrow — is what allows you to decide wisely. In this guide, you will see the current rate, the future of progressive rates, who is exempt, how it is calculated and how to pay.
What is the ITCMD and who pays it?
The ITCMD — Tax on Transmission Causa Mortis and Donation — is a tax within state jurisdiction (Constitution, art. 155, I) that is levied in two situations: on the inheritance (transmission upon death) and on the gift (gratuitous transfer during life). The party who pays is the beneficiary: the heir or legatee who receives the inheritance, or the donee who receives the gift.
The tax base is the assessed or market value of the assets on the date of the taxable event. An important point: in the probate of a married person, the spouse's marital share (the half that was already theirs under the property regime) is not taxed — the ITCMD is levied only on the portion actually transmitted. Another point: life insurance and VGBL plans are not subject to ITCMD (the Federal Supreme Court ruled out the levy on VGBL in RE 1.363.013), because they do not form part of the estate.
What is the ITCMD rate in São Paulo in 2026?
This is the most sensitive question — and where outdated information is most often seen. In São Paulo, the ITCMD rate remains fixed at 4% (art. 16 of State Law 10.705/2000), both for inheritances and for gifts, regardless of the value of the estate. A 2026 SEFAZ-SP ruling in response to a taxpayer query reaffirms the application of this 4% rate.
What causes confusion is the Tax Reform. Constitutional Amendment 132/2023, regulated as to general rules by Supplementary Law 227/2026, made progressive ITCMD rates mandatory for all states (with an 8% cap, set by Senate Resolution 9/1992). But, in São Paulo, progressive rates depend on a state law that has not yet been enacted: Bills PL 7/2024 (rates of 2% to 8%) and PL 409/2025 (1% to 4%) are under consideration.
And there is the rule of anteriority: even if one of these laws is enacted in 2026, the new rates could only take effect from 2027 (observing the annual and ninety-day periods). In other words: despite what many websites claim, São Paulo is not yet progressive — anyone referring to an “ITCMD of 2% to 8% in SP” is anticipating something that has not yet come into force. The 4% window remains open — for now.
Who is exempt from ITCMD in São Paulo?
Law 10.705/2000 provides for exemptions, and two situations are the most relevant in practice:
Low-value gift: a gift is exempt where, totaled in the calendar year between the same donor and the same donee, it does not exceed 2,500 UFESPs (art. 6, II, “a”). Because the UFESP is updated annually, the amount in reais changes each year — for this reason, the current UFESP must be checked.
Inheritance of a lower-value residential property: there is an exemption, by value bracket in UFESPs, for the residential property in which the family lives, within the legal limits. Because the limits are expressed in UFESP and there are specific requirements, it is worth confirming eligibility with SEFAZ before concluding that the exemption applies.
The logic of the gift exemption creates room for planning: annual gifts within the exempt limit, over time, can transfer assets without ITCMD — a legitimate strategy, expressly recognized by the legislation, provided the annual cap per donor/donee is respected.
How is the ITCMD calculated and how is it paid?
The calculation, today, is simple: 4% on the value of the assets transmitted (after deducting the marital share, where applicable). The value of the real property (at the assessed or market value), vehicles, investments and equity holdings is added up, and the rate is applied to the portion that goes to each beneficiary.
In São Paulo, the return is filed through the SEFAZ-SP system, which generates the payment slip (DARE). Payment must be made before the division of the estate: in judicial probate, it is a condition for confirmation; in out-of-court (notarial) probate, the notary requires proof of payment in order to execute the deed. The tax can be paid in installments (as a rule, in up to 12 installments), which helps when the estate is made up of real property and there is a lack of liquidity to pay in full.
Pay attention to the deadline and the penalty: delay in opening the probate triggers a penalty on the tax — 10%, rising to 20% if more than 180 days have passed since the death (art. 21, I, of Law 10.705/2000). It is one more reason not to leave the probate “for later”.
Practical example: the Andrade family's R$ 800,000 inheritance
Mr. Andrade passed away leaving, in São Paulo, an apartment valued at R$ 600,000 and investments of R$ 200,000 — a total estate of R$ 800,000. He was married under the partial community of property regime, and the assets were acquired during the marriage, so that half is the marital share of his wife (not taxed). The inheritance to be divided, therefore, is R$ 400,000, split between the widow and two children.
On those R$ 400,000 transmitted, the ITCMD of 4% = R$ 16,000 applies. Had the family taken more than 180 days to open the probate, there would be a 20% penalty on the tax (an extra R$ 3,200). And if the same transmission occurred in the future, already under a possible progressive rate of up to 8%, the tax could be much higher — which illustrates why so many people consider acting on planning ahead of time while the 4% rate applies.
The most common (and costly) mistakes
Believing that SP is already progressive. It is not: the rate today is a fixed 4%. Deciding on the basis of rates not yet in force leads to wrong calculations.
Delaying the opening of the probate. The 10% penalty (or 20% after 180 days) is levied on the tax and is entirely avoidable.
Taxing the marital share. The spouse's half is not an inheritance and does not pay ITCMD — calculating on the total estate inflates the tax.
Ignoring the exemptions. Gifts within the annual UFESP limit and certain residential inheritances may be exempt — it is worth checking before paying.
Forgetting about planning. Those with a substantial estate who do not organize the succession may see the cost rise with future progressive rates.
Checklist: before dealing with the ITCMD
Identify and value all the assets (real property at the assessed/market value, vehicles, investments, equity holdings).
Separate the spouse's marital share from the portion that will in fact be transmitted.
Check the applicable exemptions and the UFESP in force for the year.
File with SEFAZ-SP and generate the payment slip (DARE); consider installments if there is a lack of liquidity.
Open the probate within the deadline to avoid a penalty.
If the estate is substantial, consider estate planning while the rate is 4%.
Frequently asked questions about ITCMD in São Paulo
What is the ITCMD and who pays it?
The ITCMD (Tax on Transmission Causa Mortis and Donation) is a state inheritance and gift tax levied on inheritances and gifts. The party who pays is the beneficiary — the heir or legatee who receives the inheritance, or the donee who receives the gift. It is, as a rule, the main cost of a probate and must be paid before the division of the estate. The tax base is the assessed or market value of the assets on the date of the taxable event.
What is the ITCMD rate in São Paulo in 2026?
In São Paulo, the rate remains fixed at 4% (art. 16 of State Law 10.705/2000), both for inheritances and for gifts. The Tax Reform (Constitutional Amendment 132/2023), regulated by Supplementary Law 227/2026, made progressive rates mandatory (with an 8% cap), but this depends on a state law that has not yet been enacted — Bills PL 7/2024 (2% to 8%) and PL 409/2025 (1% to 4%) are under consideration. Under the principle of anteriority, even if enacted in 2026, progressive rates would only take effect from 2027. In short: today, the 4% rate applies.
Who is exempt from ITCMD in São Paulo?
Law 10.705/2000 provides for exemptions. For gifts, a transfer is exempt where the total, in the calendar year between the same donor and donee, does not exceed 2,500 UFESPs (art. 6, II, “a”). For inheritances (causa mortis), there are exemptions by value bracket, such as for the lower-value residential property in which the family lives, within UFESP limits. Because the UFESP is updated every year by the State Treasury Department, the current figures must be checked before concluding that an exemption applies.
Can the ITCMD be paid in installments?
Yes. The São Paulo State Treasury Department allows the ITCMD to be paid in installments, as a rule in up to 12 installments, upon request before the due date and subject to SEFAZ's own conditions (such as a minimum installment amount). Payment in installments helps when the heir does not yet have liquidity — a common situation where the estate is made up of real property. It is worth confirming the current conditions on the SEFAZ-SP portal, as they may change.
How do I pay the ITCMD of a probate in São Paulo?
In São Paulo, the ITCMD return is filed through the State Treasury Department's system (SEFAZ-SP), which generates the payment slip (DARE). The tax must be paid before the division of the estate is confirmed — in judicial probate, it is a condition for completion; in out-of-court (notarial) probate, the notary requires proof of payment in order to execute the deed. Delay in opening the probate triggers a penalty on the tax (10%, rising to 20% if more than 180 days have passed since the death). For this reason, calculating the ITCMD early avoids surcharges.
Is it worth planning the succession now because of the ITCMD?
For many families, yes. Because São Paulo's rate today is 4% and there are bills to make it progressive (up to 8%), the current moment is seen as a favorable window to organize the transfer — through a gift with reservation of usufruct, a family holding company or other tools. But estate planning is individual: it depends on the estate, the family and the tax landscape. A lawyer, together with the accountant, assesses whether it is worth acting ahead of time and the best path for your case.
Understanding the ITCMD today means deciding better tomorrow
The ITCMD is a tax in transition: stable in the present (4% in São Paulo), but with change announced on the horizon (the progressive rates of the Tax Reform). Those who understand this difference gain a concrete advantage — that of organizing the transfer of their estate while the current rules still apply.
At Falchet e Marques Sociedade de Advogados, a firm in São Paulo (Av. Paulista), we work in probate, ITCMD and estate planning, combining Succession Law with tax analysis alongside the accountant. If you are going to receive an inheritance, make a gift or organize your succession, it is worth understanding the impact of the ITCMD on your case.
Talk to our team on WhatsApp: +55 11 95901-1854 — and calculate the ITCMD for your situation before making any decision.