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Portugal Property Taxes & Fees Guide for International Buyers & Investors

Understanding property taxes and fees in Portugal is essential for international buyers and investors planning a purchase. Portugal has a transparent tax system, but costs vary depending on property value, location, buyer status, and whether the property is residential or commercial.

The main purchase tax payable when buying property in Portugal is IMT (Imposto Municipal sobre Transmissões). This is a transfer tax calculated on a sliding scale based on the purchase price and intended use of the property. Primary residences benefit from lower rates, while second homes, investment properties, and commercial real estate attract higher IMT rates.

In addition to IMT, buyers must pay stamp duty (Imposto do Selo), typically charged at 0.8% of the purchase price. Stamp duty applies to almost all property transactions and is payable at completion. These taxes are usually settled via a Portuguese bank account prior to or on the day of completion.

For guidance on managing payments and compliance, see our Portugal Banking Guide and Transferring Money Guide.

Ongoing ownership costs include IMI (Imposto Municipal sobre Imóveis), an annual municipal property tax payable by owners. IMI rates vary by municipality and are calculated as a percentage of the property’s registered value. Local councils set rates annually, meaning costs can differ between Lisbon, Porto, the Algarve, Madeira, and other regions.

Owners of high-value properties may also be subject to AIMI (Additional IMI), a supplementary tax applied to residential property holdings above certain thresholds. This tax is particularly relevant for high-net-worth buyers owning multiple properties or premium real estate assets in Portugal.

Investors generating rental income must declare earnings and pay Portuguese income tax on net rental profits. Tax rates depend on residency status, ownership structure, and whether expenses such as maintenance, insurance, and management fees are deductible. Professional tax advice is strongly recommended for rental and investment properties.

Capital gains tax may apply when selling property in Portugal. Non-residents are typically taxed on gains derived from Portuguese property, while residents may benefit from exemptions or reinvestment relief under certain conditions. Understanding exit tax exposure is just as important as budgeting for purchase costs.

Buyers should work closely with a Portuguese property lawyer and tax adviser to ensure all taxes are calculated correctly and paid on time. Late payment can result in penalties or delays at completion. For legal guidance, visit our Legal Process Guide.

Portugal’s tax framework is overseen by the Portuguese Tax Authority, which provides official guidance on property taxation, declarations, and compliance.

For related topics, explore our guides to Mortgages, Insurance, Currency, and Rental & Investment Management.

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