Guiding You Through Property Taxes in Portugal

Take a look below for expert guidance for navigating real estate transactions and taxes

The ONE Select Properties team is here to support you every step of the way, dedicated to guiding you through the property tax process when buying or selling in Portugal.

Our expert team ensures a smooth, risk-free transaction. We always recommend using a lawyer for your property transactions, but we’ve also provided useful links to help you forecast your taxes.

IMT – Property Transfer Tax

Property Transfer Tax (IMT) is charged when property ownership is transferred and must be paid before signing the final deed of sale. Proof of IMT payment is required at the notarisation of the title deed.

For residential purchases, the IMT rate is based on the higher value between the purchase price or the VPT (determined by local tax authorities considering construction costs, age, location, and use of the property). Rates vary depending on whether the property is urban or rural, with slightly higher rates for second homes.

Properties over EUR 1 million: 7.5% IMT rate
Construction plots and urban non-residential properties under EUR 1 million: 6.5% IMT rate
Rustic land: 5% IMT rate
Properties bought via share purchase in a non-resident company: IMT does not apply
Properties acquired by offshore entities in blacklisted territories: 10% IMT rate

Stamp Duty, Notary, And Registration Fees

Stamp duty in Portugal applies to many transactions. For property purchases, the buyer pays a stamp duty of 0.8% of the sale price or tax asset value, whichever is higher. This must be paid before signing the final deed, as proof of payment is required at notarisation.

Registration in the Land Registry Office costs EUR 250, usually handled by the lawyer. Notary fees are fixed by law, varying based on the sale price. Legal fees generally range from 1-2% of the property price, depending on the complexity of the transaction.

Close-up of two people seated at a desk, reviewing documents and writing notes, symbolizing professional consultation and paperwork for Portuguese property taxes.

Close-up of various Euro coins stacked in piles, symbolizing the small or recurring costs and financial planning needed for Portuguese property taxes.

IMI – Annual Property Tax

IMI is an annual tax set by the local council, varying from 0.3% to 0.45% in urban areas, levied on the tax asset value of the property. In the municipality of Loulé, the IMI rate is 0.3%. Rural properties have an IMI rate of 0.8%.

Properties owned by white-listed companies have a flat IMI rate of 0.4%, while offshore entities in blacklisted locations face a 7.5% IMI rate. IMI is typically paid annually in two or three instalments, depending on the amount owed.

AIMI – Additional Municipal Property Tax

Introduced in 2017, AIMI applies to the combined VPT of all urban properties owned by an individual or couple. AIMI is only paid on values exceeding EUR 600,000 per person (EUR 1.2 million per couple) with the following rates:

EUR 600,000 – 1 million: 0.7% rate
Over 1 million: 1% rate
Over 2 million: 1.5% rate

For corporate structures, AIMI is 0.4% unless the property is used personally by shareholders or their families, in which case standard rates apply without exemption thresholds. Offshore entities in blacklisted territories face a higher AIMI rate of 7.5%. AIMI does not apply to non-habitual or rural properties.

Close-up of a person typing on a laptop with a calculator in the foreground, symbolizing the research and financial calculation needed to understand Portuguese property taxes.

Close-up of scattered Euro banknotes (including 100 and 200 Euro notes), symbolizing the financial costs and payments involved in Portuguese property taxes.

Capital Gains Tax

Capital gains tax is calculated on the difference between the purchase and sales price of the property. Expenses incurred during ownership, such as refurbishment costs and notary, registration, and estate agency fees, can be offset against this tax. Non-residents are taxed at 28% of the profit made.

Portuguese residents and European Community citizens (with primary residence registered to this property) are taxed on 50% of their gains which will only be included in the coming year’s tax return submission. Exemptions apply if the proceeds from selling a primary residence are reinvested into another primary residence in the EU/EEA within 12 months.

For corporate ownership, the flat CGT rate is 25%.

Inheritance Tax

In Portugal, there is no inheritance tax between immediate family members (spouse, ascendants, and descendants). A 0.8% stamp duty based on the VPT must be paid on gifts for close family members. Gifts or inheritance to other individuals may incur additional taxes.

ONE Select Properties is here to guide you through every step of your property transaction, ensuring you understand and comply with all tax obligations. Contact us today to learn more about how we can assist you in making your property dreams in Portugal a reality.

Overhead shot of a laptop, a pen, and a blue notebook with large numbers, symbolizing the process of calculating and managing Portuguese property taxes (IMT, IMI).

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