The taxes in brief
A buyer normally deals with IMT and stamp duty before completion. An owner may then pay annual IMI and, for higher combined taxable property values, AIMI. A later sale can create a taxable capital gain.
Tax depends on the property, its use, ownership structure and the owner's residence. Confirm the figures for the specific transaction before signing.
Taxes when you buy
IMT is generally calculated on the higher of the purchase price and the taxable property value. The rate depends on the property type, use, location and value. Stamp duty on the purchase is normally 0.8% of the same taxable base.
- The buyer is responsible for the purchase taxes.
- Payment or proof of exemption is required for completion.
- Mortgage borrowing can create additional stamp duty and bank costs.
IMT bands change. Use the official table for the year of completion and obtain a transaction-specific calculation.
Taxes while you own
IMI is charged each year on the property's taxable value, known as the VPT. For urban property, each municipality sets its rate within the national limits, generally between 0.3% and 0.45%, with a higher exceptional limit in some cases.
- The registered owner on 31 December is generally responsible for that year's IMI.
- Payment dates depend on the amount due.
- Condominium and resort charges are separate from tax.
AIMI and higher property values
AIMI generally applies to the combined taxable value of residential property and building land held in Portugal. For individuals, the standard deduction is currently €600,000, or €1.2 million where eligible couples choose joint assessment.
Rates and deductions differ for individuals, companies and some ownership structures. Do not assume that splitting ownership or buying through a company gives a better result.
Tax when you sell
A capital gain is not simply the sale price minus the original price. Documented acquisition costs, qualifying works, sale costs and statutory indexation can affect the calculation.
- Keep deeds, invoices and proof of payment for works and professional costs.
- Residence status and any applicable tax treaty can change the final position.
- A Portuguese tax return may be required even if tax is also considered elsewhere.
Points for non-residents
Portugal can tax income and gains linked to Portuguese property even when the owner lives elsewhere. The country of residence may also require a declaration and may give relief for Portuguese tax under domestic rules or a tax treaty.
Take advice before a sale, a change of ownership or a move between countries. Timing and ownership structure can matter.
Questions we hear
Is stamp duty included in IMT?
No. They are separate taxes. On a property purchase, stamp duty is normally 0.8% of the value used for IMT, and borrowing may create further stamp duty.
Is IMI based on the purchase price?
No. IMI is based on the property's taxable value, or VPT, and the rate set by the municipality.
Does every owner pay AIMI?
No. It depends on the type and combined taxable value of the property, available deductions and the ownership structure.
Can renovation invoices reduce a capital gain?
Some documented costs may be deductible if they meet the legal rules. Keep full invoices and payment records and confirm eligibility with a tax adviser.
General guidance, independent advice.
This guide summarises official information available on the update date. Rules, rates and procedures can change, and personal circumstances matter. Aurea Properties does not provide legal, tax or immigration advice.
Check your position with Allawyers or another suitably qualified adviser before acting.