Property Taxes

Understand the Portuguese property tax regulations...

Property Transfer Tax

A property transfer tax (Imposto Municipal sobre as Transmissões - IMT) must be paid by the buyer of any property at the time of purchase. This tax is due whether it is a new build or an existing property. The rate of this tax differs depending on the purchase price and whether the property is to be used for a primary home or secondary/rental property.

In certain rural areas of the country, some reductions in IMT may be available for those aged between 18 and 35 years of age buying a permanent, residential property. More information on reductions may be available from the bank assisting with financing the purchase.

  • For information on the rates of property transfer tax due visit: The Finance Portal (in Portuguese)

Local Property Taxes

Council/municipal tax

The owner of a residential property whether it is used by themselves or leased out, must pay a local tax known as Imposto sobre Municipal Imoveis (IMI). This tax is raised and spent by the town hall (municipio) and must be paid by the end of April each year of the amount is not greater than €250. Amounts over €250 are paid in two equal payments due in April and September. If the calculated tax is not greater than €10, no payment is due.

If the value of the property is less than €157,500 there is an exemption period of six years. If the value is between €157,500 and €236,250 this period is reduced to three years. These exemptions are applicable to both residents and non-residents.

The amount due is calculated differently for homes built prior to 2003 than for those built after that year.

Maisvalias

When a property is sold, or it otherwise changes hands, the local town hall raises a tax called maisvalias which is a tax on the increase in the value of urban land (excluding the value of any buildings). The tax includes a realistic allowance for inflation in the growth in value of the land. Some transactions, such as transfers between husband and wife, are exempt. However, maisvalias remains payable on the disposal of a main residence even for Portuguese residents.

This is a tax paid at the same time as personal income tax (Imposto sobre o Rendimento das Pessoas Singulares - IRS) at the end of the year and is not taxed locally.