Immobilienkauf und -verkauf in Portugal

This article on Buying and Selling Property in Portugal was written by a Portuguese lawyer, qualified to handle such matters. It is a purely informative article, intended to clarify the main initial questions regarding the property buying and selling process. However, it is recommended to seek clarification from a lawyer or solicitor. In Portugal, only a lawyer or solicitor can provide legal advice on the buying and selling process and draft property purchase and sale agreements. Any other entity may be engaging in unauthorized legal practice.

1. What documents do I need to buy a property in Portugal?

Portuguese law stipulates that a property purchase and sale agreement must be executed by public deed or authenticated private document by a lawyer or solicitor. The public deed can be carried out (1) at a Notary’s Office in the presence of a notary, (2) at “Casa Pronta”, a service provided by the Ministry of Justice, or (3) at a location in the presence of a lawyer or solicitor with the power to act. The buyer and seller are usually involved in this deed or private document. In special cases, other entities may be involved, such as representatives of credit institutions, proxies representing the buyer or seller, spouses who must consent to the sale, or interpreters if the buyers or sellers do not understand Portuguese. Regarding the documents required for the deed, we can distinguish between (1) documents relating to the parties involved and (2) documents relating to the property.

The documents and information relating to the parties involved, required for the execution of the purchase and sale deed, or authenticated private document (an alternative to the public deed, drawn up and authenticated by a lawyer or solicitor, with the same legal effects), are as follows:

For individuals:

• • Identity card, citizen card, or passport
  • Taxpayer identification number.
  • Information on personal data:
    • marital status (married, single, divorced, widowed),
    • marital property regime (separation of assets, community of acquired property, general community of property),
    • place of birth (place of birth and respective parish and municipality)

For legal entities, and specifically for commercial companies:

• Commercial Registry Certificate, issued less than one year ago, and company identification card (other documents may also be required, such as minutes of the board of directors or general meeting, depending on the type of company, its corporate purpose, and the form of representation).
• Identification document of the company’s legal representatives acting on behalf of the company (Citizen card or identity card, taxpayer identification number).
• The consultation code for the declaration of the company’s (RCBE) Central Registry of Beneficial Owners

The documents relating to the property, required for the execution of the purchase and sale deed, are as follows:

• Land Registry Certificate, or, access code to the Permanent Land Registry Certificate: issued less than six months ago by the competent Land Registry Office. This document will contain the description of the property and its registration in the seller’s name, and allows verification of any encumbrances or charges registered on the property, which must be cancelled by the date of the deed, such as: mortgages, seizures, easements, or pre-emption agreements.
• Property Tax Caderneta: issued or updated less than one year ago by the Tax Office for the property’s area or obtained online by the property owner. This document allows verification of whether the property is registered in the owner’s name, its areas, composition, adjoining properties, and its tax value (fiscal value of the property after assessment by the Tax Office).
• Usage License: issued by the Municipal Council for the property’s area (in certain specific situations, the usage license may be replaced by the construction license or even waived, in the case of a property built before August 7, 1951, i.e., before the General Regime for Buildings and Construction came into force, or if the property was registered in the tax registry (at the Tax Office) in 1937). This document allows verification of whether the property is duly licensed by the competent authority for residential, commercial, or service use.
• Permanent Certificate: issued by the Municipal Council for the property’s area, certifying the provisional acceptance of urbanization works or the provision of sufficient guarantees for the completion of urbanization works (only when it concerns the first transfer of properties built on plots or autonomous units of such properties);
• Technical Data Sheet for Housing: (only in the case of purchasing residential property for which the application for a usage license was submitted after March 30, 2004);
• Documents proving the waiver of respective pre-emption rights: issued by the Municipal Council and/or by the Directorate-General for Cultural Heritage (IP), (the entity that succeeded the extinct DGPC and, previously, IGESPAR, since January 1, 2024) (only in cases where the law grants these pre-emption rights to the aforementioned entities) or by adjoining landowners in the case of rural land.
• Energy Certificate and Indoor Air Quality Certificate for Buildings.
• The consultation code for the (RCBE) Central Registry of Beneficial Owners declaration, if the grantor is a legal entity.

At the time of the public deed of purchase and sale, the buyer must provide the Notary or Lawyer/Solicitor with the tax payment receipts for the taxes due by the buyer: Municipal Tax on Onerous Property Transfers (IMT) and Stamp Duty (I.S.) with proof of payment, except in cases where the acquisition is exempt from this tax (IMT). If you intend to use bank credit to finance the acquisition, the buyer should confirm the documents required by their bank. In these situations, one of the requirements usually demanded is the presentation of provisional registration of acquisition and mortgage.

2. When I intend to buy a property, should I or should I not enter into a preliminary purchase and sale agreement?

After reviewing all property documentation and all prerequisites and conditions related to the property acquisition, the preliminary purchase and sale agreement will be drafted, i.e., the contract through which the parties undertake, by mutual agreement or unilaterally, to enter into a certain future and definitive contract. Signing a preliminary purchase and sale agreement is advisable in situations where there is an interest in securing the transaction, but the necessary conditions for the final purchase and sale deed are not yet met. This situation can occur for various reasons, namely, the completion of the property construction, the pending establishment of horizontal property, the property lacking a usage license, or the buyer not having the necessary funds to pay the price or still awaiting bank financing approval for the acquisition.

• By entering into a preliminary purchase and sale agreement, the parties can immediately bind themselves (at a time when they do not yet have all the necessary documentation or interest in entering into the deed) ensuring that, within the agreed timeframe, they will formalize the purchase and sale. In this contract, the parties guarantee legal security in case of delay or breach of contract.

Usually, the decision to enter into a preliminary purchase and sale agreement is related to the need to urgently formalize a binding document between the buyer and the seller, ensuring the reservation of the future transaction with the formalization of a public deed of purchase and sale. The decision on whether or not to enter into a preliminary purchase and sale agreement is an optional decision for the parties involved (buyer and seller of the property).

3. What are the essential elements of a preliminary purchase and sale agreement?

The content of a preliminary purchase and sale agreement can vary considerably depending on the specific circumstances of the parties, the situation of the property subject to the contract, and the intended business model. Therefore, the preliminary agreement can and should contain all the conditions and obligations that formed the basis of the transaction, namely, essential and accessory clauses, any suspensive or resolutive conditions that may have been defined, definition of the price and the payment conditions and deadlines, definition of the date for the property purchase and sale deed, identification of applicable guarantees and penalties, and all other necessary clauses to safeguard the interests of the property buyers and sellers. Furthermore, the analysis of the property documents may reveal circumstances relating to it that should be addressed in the clauses of the preliminary purchase and sale agreement. It is common, for example, to include in the preliminary purchase and sale agreement the seller’s obligation to regularize any discrepancies found in the property documents. Finally, the physical condition of the property may also justify the inclusion of specific provisions in the preliminary agreement. It is frequent to include in the preliminary agreement the seller’s obligations to carry out certain works or repairs on the property before the execution of the public purchase and sale deed.

In summary, we can indicate the following essential elements that should be included in a preliminary purchase and sale agreement:

1. Full identification of the parties (for individuals: name, place of birth and nationality, marital status, residence, identity card/citizen card number, and taxpayer identification number; and, for legal entities: company name, registered office, share capital, registration number and company identification number, and identification of who represents the company, stating the capacity and powers with which they act);
2. Full identification of the property subject to the promise: (location and composition, property description number at the Land Registry Office, cadastral article under which the property is registered with the Tax Office, and number, issue date, and issuing authority of the usage or construction license, or mention of its waiver);
3. Stipulation of the promise, specifying: whether it is a bilateral or unilateral promise, and whether the property is acquired free of encumbrances, charges, or other liabilities, and free and vacant of people and goods;
4. Price and method of payment, including the amount of the deposit and any subsequent installments, if applicable;
5. Deadline for the execution of the purchase and sale deed and indication of who should arrange it;
6. Any conditions to which the parties wish to subject the purchase and sale of the property and the consequences of their non-fulfillment;
7. Indication of the guarantees and duties of the parties involved in the transaction, for example:
   • Declaration for legal purposes that, as of the date of the property purchase and sale deed, the property will be duly demarcated according to legal requirements for cadastral purposes, the areas stated in the property tax caderneta match the property description and the plans approved by the Municipal Council through the usage license;
   • Declaration that in the preliminaries and in the formation of this contract, no information or fact that the Promising Buyers should have known when considering their intention to carry out the transaction has been omitted, either regarding the physical and legal condition of the property, which may have direct or indirect implications for the present sale of the vacant property free of encumbrances, charges, or liabilities;
   • Declaration that the property is duly registered at the Land Registry Office and inscribed in the cadastre in their favor;
   • The existing areas and constructions correspond to the areas and composition described in the respective cadastral, land registry, and municipal documentation, so in case of discrepancy, it should be rectified before the date of the deed;
   • That the property is free of any encumbrances, mortgages, charges, or liabilities, and is vacant;
   • To the best of their knowledge, there is no notification, complaint, arbitration lawsuit, or other pending proceeding or threat thereof, which may affect their right over the Property, before any Court, government department, or local authority that in any way affects or will affect the fulfillment of the duties herein set forth;
   • Except for the clauses of the preliminary contract, there is no lease agreement or any other contract, of any nature whatsoever, related to the Property or part thereof, which may materially restrict or limit the use or disposal thereof by the promising buyers;
   • Proof that there are no outstanding debts to the tax authorities related to the properties, resulting from the acquisition or use by the promising seller;
   • That the property is in regular habitable condition and with all its equipment and internal networks and installations for water, electricity, sewage, and gas in normal working order and has not undergone any alteration in its configuration and boundaries;
   • If there is, on the present date, any insurance policy on the property subject to this contract, the Promising Sellers undertake to keep it in force until the date of the public purchase and sale deed.
8. Indication of the method of notification and location, mandatory mention of the involvement or non-involvement of real estate mediation.
9. Consequences in case of breach of contract, namely, the application of the specific performance regime provided for in Article 830 of the Civil Code.
10. The competent court to hear any dispute arising from the contract. As a rule, the District Court of the property’s location will be competent, or the parties may opt for an Arbitration Court.

In the case of a preliminary purchase and sale agreement for the execution of an onerous contract for the transfer or constitution of a real right over a building, or an autonomous unit thereof, already built, under construction, or with planned construction, the preliminary purchase and sale agreement must include the personal recognition of the signature of the promisor or promisors (depending on whether it is a unilateral or bilateral promise) and the certification by the notary of the existence of the respective usage or construction license.

4. What does it mean to “assign contractual position” as a promising buyer in a preliminary purchase and sale agreement?

The preliminary purchase and sale agreement may provide for the possibility of the promising buyer assigning their contractual position to a third party. If the preliminary purchase and sale agreement does not provide for the possibility of assigning the contractual position, the assignment of contractual position is subject to prior authorization from the promising seller. Assigning contractual position means transferring to a third party the position of promising buyer in a specific preliminary purchase and sale agreement, with that third party becoming the holder of all rights and duties that arise for the promising buyer from that preliminary agreement. The assignment of contractual position, investing the third party with the position of promising buyer, results in the release of the initial promising buyer. Both the assignment of contractual position and the mere possibility of assignment provided for in the preliminary purchase and sale agreement have tax obligations in terms of IMT. In effect, tax law presumes an onerous transfer whenever there is an assignment of contractual position (current or potential), taxing it as if it were a true transfer, i.e., the tax is levied on the value of the deposit paid by the buyer at the rate applicable to the total value. Whenever the definitive preliminary purchase and sale agreement is executed, or the taxable event occurs before the execution of the definitive contract that operates the legal transfer of the asset, and the contracting party has already paid the due tax, additional assessment will only be made if the value corresponding to the definitive transfer is higher than the value that served as the basis for the previous assessment. In the case of the acquirer benefiting from a reduced rate or exemption, the tax will be partially or totally annulled. The inclusion of clauses in the preliminary agreement that allow or provide for the possibility of the promising buyer assigning their contractual position to a third party should always be carefully considered, given the associated tax consequences.

5. What are the consequences of breaching a preliminary purchase and sale agreement?

The consequences of breaching a preliminary agreement may be stipulated in the agreement itself. In the absence of specific stipulations in the preliminary purchase and sale agreement, the general rules provided for in the Civil Code shall apply.

The Civil Code establishes the following supplementary rules:

• In case of breach by the promising buyer, they will forfeit the deposit paid to the promising seller;
• In case of breach by the promising seller, they are obliged to return double the deposit paid by the promising buyer; as an alternative to returning the deposit in double, in situations where possession of the property has been transferred, the promising buyer may demand the objectively determined value of the property at the date of the breach of the promise, minus the agreed price, and shall also be reimbursed for the deposit and any part of the price already paid;
• The preliminary agreement should indicate the deadline for it to be considered a breach and not just a delay (mora). It may be indicated that a definitive breach will be considered whenever, with one party in mora (delay in fulfillment), the other party sends a formal notice (sends a written communication) setting a reasonable deadline for the fulfillment of the obligation in question, and the defaulting party fails to fulfill their obligation within that period.
• Therefore, the parties must stipulate in the contract the reasonable deadline for fulfillment, for the purposes of Articles 801 to 808 of the Civil Code, after the due date for executing the deed, for such delay (mora) to become a definitive breach.
• If the party fails to comply again by the indicated date, the other party must send a new written communication in the manner agreed in the contract, indicating that the contract is considered definitively breached, resulting in the forfeiture of the deposit or the right to receive double the amount paid.

As an alternative to the aforementioned compensation, the non-defaulting party may opt to request the court for specific performance of the contract, with a view to obtaining a court judgment that replaces the declaration of intent of the defaulting promisor, thus achieving coercive fulfillment of the preliminary purchase and sale agreement.

6. What is a provisional registration? When I intend to buy a property, what registrations should I make and when?

The Land Registration Code provides for the possibility of making provisional registrations. The provisional registration of acquisition consists of the registration of acquisition in favor of the buyer, before the execution of the purchase and sale deed. The seller declares at the time of registration that they have promised to sell that property to the buyer for the price defined in the preliminary purchase and sale agreement. The provisional registration of mortgage consists of the registration of a mortgage on the property before the respective mortgage deed is executed (which in most cases is executed together with the purchase and sale deed). These registrations serve to guarantee registered priority over any other registrations that, hypothetically, could be promoted by third parties until the date of the deed (such as seizures or mortgages). The application for provisional registration of acquisition must be signed by the promising seller (with their signature being personally recognized, or, alternatively, the registration application being signed in person at the Land Registry Office). If there is a signed preliminary purchase and sale agreement with recognized signatures, the registration application may be signed by a lawyer/solicitor or by the promising buyer themselves, provided that the registration request is accompanied by the preliminary agreement (or a certified copy thereof). Regarding the provisional registration of mortgage, the respective application must be signed by the promising buyer (with their signature being personally recognized, or, alternatively, the registration application being signed in person at the Land Registry Office), provided that a provisional registration of acquisition in their favor has been previously submitted (in practical terms, these registrations are submitted simultaneously, with the acquisition registration being processed before the mortgage registration). Provisional registrations expire six months from the date of their submission, if they are not converted into definitive registrations (although they can be renewed). After the execution of the deed/authenticated private document of purchase and sale and mortgage, where applicable, the provisional registrations of acquisition and mortgage must be converted into definitive registrations (the effects of the acquisition and mortgage retroact, for registration purposes, to the date on which the requests for provisional registrations were submitted). While provisional registrations usually only take place when there is acquisition financing (as they are a requirement from the bank), the truth is that making provisional registrations of acquisition, even when a bank is not involved, constitutes an additional guarantee for the buyer. Indeed, a provisional registration of acquisition can give the buyer the assurance that, when they execute their purchase and sale deed, they can convert the registration of acquisition into a definitive one, removing the registration of other encumbrances or charges that may have been registered on the property in the meantime. If no provisional registrations are made, neither for acquisition nor for mortgage, the registration of acquisition should be processed immediately after the execution of the public purchase and sale deed. Finally, it should be noted that any registration request must be accompanied by the property tax caderneta or cadastral certificate of the property.

7. What is a Technical Data Sheet for Housing?

The Technical Data Sheet for Housing is a document that describes the technical and functional characteristics of the dwelling, and its presentation is mandatory at the time of the deed/private document for all properties for which the application for a usage license was submitted after March 30, 2004. Whenever a new residential property is being acquired, a copy of the Technical Data Sheet for Housing or the provisional Technical Data Sheet for Housing should be requested, if the property is not yet completed. The law establishes that the Technical Data Sheet for Housing cannot be handwritten (except for the signatures of the technicians) and must be written in Portuguese in a clear and understandable manner for the recipient. The Technical Data Sheet for Housing must contain information about the main professionals involved in the project, construction, reconstruction, expansion, or alteration, as well as information about the developer, the land subdivision, the urban building, and the autonomous unit or single-family dwelling in question.

The following are also mandatory information that must be included in the Technical Data Sheet for Housing:

• Housing warranty, as well as its activation procedure in case of detected defects;
• Rules of operation of the condominium, if any, and service contracts that have been entered into;
• Maintenance rules for installed equipment that requires special treatment.

The plans relating to the development, building, and autonomous unit must be identified in the appropriate section of the Technical Data Sheet for Housing and constitute an annex that is an integral part of the document. The preparation of the Technical Data Sheet for Housing is the responsibility of the property developer, who, together with the site manager, must sign this document, attesting to the veracity and conformity of the information contained in the Technical Data Sheet for Housing with the architectural and specialty projects relating to the property. Deeds of purchase and sale of properties for which the usage license was applied for after March 30, 2004, can only be executed if the Technical Data Sheet for Housing of the property in question is presented to the notary/lawyer. This obligation applies to both first transfers and all subsequent transfers. The owner has the obligation to keep the Technical Data Sheet for Housing as long as they own the property and, in case of sale, must hand it over to the new owner. In case of loss, misplacement, or damage to this document, the owner can obtain a duplicate of the Technical Data Sheet for Housing from the property developer or the competent Municipal Council. The developer is obliged to keep the respective Technical Data Sheet for Housing for a period of 10 years, and the Technical Data Sheet for Housing will also be filed with the competent Municipal Council.

8. What documents should I request and what precautions should I take before the execution of the Public Deed/Authenticated Private Document for the purchase and sale of a property?

Prior to purchasing a property, a series of checks should be carried out to confirm its legal status. Many issues related to the legal status of the property can be verified through the property-related documents, which are usually provided by the seller and have already been mentioned in response to question no. 1. In any case, the entities from which property-related documents can be obtained, as well as the information that can be obtained from such entities, are indicated below.

At the competent Land Registry Office, you can obtain a land registry certificate for the property and verify the following situations:

1. Whether the property has the description indicated by the seller and whether it matches the description in the property tax caderneta and the Project approved by the Municipal Council and the usage license issued by it;
2. Whether the seller is the current and sole owner, and therefore has the legitimacy to sell the property;
3. Whether there are no registered or pending registrations of mortgages or seizures in favor of third parties;
4. Whether there are no other registered rights or pending registrations that could restrict the use of the property.

At the Tax Office for the property’s area, you can obtain a property tax caderneta or cadastral certificate for the property and verify the following situations:

1. Whether the property description with the tax authorities corresponds to the property description in the land registry certificate;
2. Whether the property is vacant (this confirmation is not absolute, as there may be irregular lease agreements, i.e., those not declared to the Tax Authorities);
3. Whether there are any outstanding amounts related to Municipal Property Tax (IMI) or, conversely, whether there are tax debts of this nature for which the property may be liable.
4. Verify if the Property has already been valued according to CIMI rules and what its Taxable Value is (the value on which municipal property tax will be levied).

At the competent Municipal Council, you can obtain usage or construction license certificates and also verify the following situations:

1. Whether construction/usage licenses have been issued for a property and whether what has been built corresponds to the approved project.
2. Whether the land is located in an area authorized for urban construction, and whether a subdivision permit has been issued, if applicable (in the case of acquiring land for future housing construction);
3. What are the characteristics of the property that can be built (in the case of a property to be built on land with construction authorization);
4. Whether there are pre-emption rights in favor of the Municipal Council or the State related to the property.

The documents required for the deed/private document are those indicated in the answer to question no. 1. In addition to the documents mentioned above and the checks indicated above, it is also important to verify if there are pre-emption rights in favor of third parties other than the State (owners of adjoining properties, in the case of the transfer of a rural property, or owners of other rural properties in the same area, in the case of a rural property included in a National Agricultural Reserve area, tenants of the property, etc.). If there are pre-emption rights in favor of third parties, the seller must provide proof that the holders of the respective pre-emption rights have been notified to exercise such right and have waived the exercise thereof (expressly or by allowing the deadline to pass). Finally, if a mortgage encumbers the property, the seller must be required to ensure its cancellation, presenting, at the latest on the date of the deed, a cancellation document. This situation is common, considering that it is usual for property developers to finance their developments by offering the properties subject to the development as collateral, and subsequently cancelling the mortgage for each autonomous unit, plot, or house as they are sold. In addition to the legal aspects mentioned above, before purchasing a property, the buyer should always carry out a physical inspection of the property (on-site confirmation of the areas, characteristics, and boundaries of the property, its location, state of conservation, activities carried out by neighbors that could prejudice the use of the property, etc.).

9. When should I pay the Municipal Tax on Onerous Property Transfers (IMT)? How is the taxable amount calculated?

If the tax is not exempt, the IMT payment must be made to the competent Tax Office or online (https://www.e-financas.gov.pt) before the purchase and sale deed is executed by the buyer. The value used as the basis for calculating IMT is the property’s tax value or the transmission value, whichever is higher. The amount of IMT is determined by applying the rates provided for in the IMT Code, which are distributed by brackets. Both the brackets and the rates are usually updated annually by the Law approving the State Budget.

10. Is there an exemption from Municipal Tax on Onerous Property Transfers (IMT) for the acquisition of residential property?

As a general rule, IMT exemption must be requested before the act or contract that originated the transfer and always before the assessment that would be made. You benefit from an exemption if you acquire a property exclusively intended for your own and permanent residence, and if the property’s tax value or declared value does not exceed the maximum value of the 1st IMT bracket, currently set at €106,346 (Mainland Portugal) — a value updated annually by the State Budget. Additionally, young people up to 35 years old who buy their first own and permanent residence benefit from total exemption from IMT and Stamp Duty up to €330,539, and partial exemption between €330,539 and €660,982 (IMT Jovem, created by Decree-Law No. 48-A/2024, of July 25, with values updated by the State Budget 2026). These benefits or rate reductions also apply to property exchanges if the received property is intended for own and permanent residence, or exclusively for housing, and if the difference in tax values or declared values (the greater of the two) between the property you hand over and the one you receive does not exceed the maximum value of the 1st IMT bracket (currently €106,346 in Mainland Portugal). The exemption benefit applies only to urban buildings exclusively intended for own and permanent residence and not to land intended for the construction of such properties. If the assets are used for a different purpose within six years from the date of acquisition, except in the case of sale, if the properties are not used for own and permanent residence within six months from the date of acquisition, or if, in the case of property valuation that should have effects for IMT purposes, the tax value exceeds the maximum value of the 1st IMT bracket in force at the time of acquisition.

What are the IMT rates?

• Rural properties: 5%
• Urban properties intended for secondary residence or rental: 1% to 8% (the 1st bracket is not exempt, unlike for own permanent residence)
• Urban properties exclusively intended for own and permanent residence: 0% to 8% (total exemption up to €106,346; progressive rates by bracket, with a single rate of 7.5% for high values)
• Other properties and other acquisitions: 6.5%
• Properties acquired by entities domiciled in a country, territory, or region subject to a clearly more favorable tax regime, listed in an ordinance from the Minister of Finance: 10%

IMT Payment Deadline?

As a general rule, IMT must be paid on the day of assessment or on the first working day thereafter. If the act or contract is executed abroad, the tax must be assessed and paid during the month following the transfer.

What other taxes and costs apply to the purchase and sale?

Stamp Duty: On the acquisition value: 0.8%. This tax is assessed by the buyer at the time of the purchase deed and is levied on the tax value or the agreed value between the parties, whichever is higher. On the loan amount: Stamp Duty on credit concession (Item 17.1 of the TGIS):

• Up to 1 year, per month or fraction: 0.04%;
• From 1 to 5 years: 0.5%;
• Over 5 years: 0.6%.

Deed/Private Document Fees and Land Registration: The fees for the deed or private document depend on the notary or lawyer/solicitor who prepares the document. Land registration of acquisition has costs that vary according to the property value and the type of act. These values are updated periodically — it is recommended to consult the current values on the IRN Portal (Institute of Registries and Notary).

What steps should be taken after the execution of the purchase and sale deed?

The responsible lawyer or Notary must register the acquisition in the buyer’s name within 10 days of signing the purchase and sale deed, or private document. In addition to the acquisition registration at the Registry Office, the acquisition must be endorsed in the name of the new owners. From the date of acquisition, the new owners will be responsible for paying property taxes and expenses.

What taxes are due after purchasing the property?

IMI (Municipal Property Tax)

This is an annual Municipal Tax, levied on the taxable value of the dwelling. This value will be determined by an assessment based on various criteria. IMI is an annual tax, levied on the taxable value recorded in the property cadastre and is calculated by multiplying this value by a percentage that can range from:

• 0.3% to 0.45% (urban properties — rate set annually by each municipality)
• 0.8% (rural properties)
• 7.5% (properties owned by entities domiciled in tax havens — not applicable to individuals)

For mixed-use properties in Portugal (consisting of a rural and an urban part), the respective rate will apply to the taxable value of each part. Properties owned by entities domiciled in a country, territory, or region subject to a clearly more favorable tax regime, listed in Ordinance No. 150/2004, of February 13, with its successive updates, the most recent being Ordinance No. 292/2025/1, of September 5, commonly referred to as “offshore,” are taxed at a rate of 7.5% regardless of the type of property they own. However, this increased rate does not apply to properties owned by individuals. Municipalities, by resolution of the municipal assembly, may increase or decrease the general rates mentioned above in certain situations provided for in Article 112 of the IMI Code. Houses intended for own and permanent residence, or for rental for housing, may benefit from temporary exemption from this tax for a period of 3 years, if the property’s tax value does not exceed €125,000, provided that the household income does not exceed €153,300. Permanent exemption may be available for low-income families — the limits are updated annually based on the IAS; in 2026, the annual gross income of the household cannot exceed €16,824.50 and the total taxable value of the household’s properties cannot exceed €73,150. This exemption is automatically granted by the Tax Authority. If it is not applied, it can be requested on the Finanças Portal or at the competent Tax Office. The allocation of the property to own and permanent residence must occur within a maximum of 6 months after acquisition. (*) Residential urban buildings, built, expanded, improved, or acquired onerously, intended for the owner’s or household’s own and permanent residence.

— End of article on Buying and Selling Property in Portugal —