How much land is ceded to the municipality when subdividing: 5% and 7%
When land is subdivided, part of the area must be transferred free of charge to the municipality. The law calls it a "mandatory real estate contribution". It is a central figure in the preliminary design, because that area is not sold. It is worth understanding what the text says and what it leaves unclear. If you need us to calculate it on your plan, start with our land subdivision service.
What article 247 says
Art. 247 of Law 3966/10 (amended by Law 4198/10) defines the contribution as the area the owner must transfer free of charge to the municipality "for traffic routes, squares or public buildings". It sets these percentages:
- Properties of 2 hectares or more: contribution of 5% of the area, intended for a square and/or public buildings, in the location decided by the municipality.
- Properties of 3 hectares or more: 7%.
- The contribution is mandatory only in subdivisions or divisions intended for sale in urban, suburban or rural areas, for urbanization purposes.
Example of the calculation: on a 10-hectare plot (100,000 m²), 7% is 7,000 m² for squares and public buildings.
What the text does not clarify
- Whether streets count toward the 5% or 7%. The definition speaks of routes, squares and buildings, but the percentage is described as intended for squares and public buildings. The practical interpretation is made by each municipality, and it may require streets in addition. Confirm with yours before calculating.
- What happens with properties of less than 2 hectares. The article does not set a percentage for them. Law 1909/02 did, but it is repealed.
The mistake of using Law 1909/02
Many sites still cite Law 1909/02 on subdivisions: 5% for squares and 2% for public buildings on properties of two hectares or more, and 7% of the fiscal value on smaller properties. That law was repealed by art. 283 of Law 3966/10. If your advisor uses those figures, ask for the current rule.
What to do with that area
The parcels are registered in favor of the municipality. The subdivider has one year to do so, with a fine of 20 minimum daily wages per hectare if they fail to comply, and the costs are borne by them (arts. 246 and 249). The municipality determines the location of squares and buildings, and tries to place them equidistant from the ends of the subdivision (art. 248). More in the owner's obligations after approval.
Other parameters of the preliminary design
- Minimum urban lot of 360 m², and each municipality may set more (art. 227).
- Streets of 16 meters and avenues of 32 meters, sidewalks included (art. 229).
- Built area of up to 75% of the plot (art. 228).
Frequently asked questions
How much must be ceded to the municipality when subdividing?
Under art. 247 of Law 3966/10: 5% for properties from 2 hectares and 7% from 3 hectares. Streets may also be required, depending on the municipality.
Is Law 1909/02 still in force?
No. It was repealed by art. 283 of Law 3966/10.
Do I get paid for the ceded area?
No. It is transferred free of charge to the municipality, and the transfer and registration costs are paid by the subdivider.
What about land of less than 2 hectares?
Art. 247 does not set a percentage for them. Confirm with your municipality what it requires by ordinance.
Sources
- Law 3966/10 Municipal Organic Law, consolidated text
- Law 4198/10, amends arts. 239, 240 and 247 of Law 3966/10
- Law 1909/02 on Subdivisions (repealed)
- Law 5346, amends arts. 245, 246, 248, 250, 255 and 258 of Law 3966/10
Notice. Informational content with rules consulted on 09/29/2026. Deadlines and values are indicative and vary by municipality and service provider; always confirm with the municipality or the relevant body. It does not constitute legal, tax or engineering advice, nor a promise of profitability. Last updated: September 30, 2026.