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Taxes on purchaseHow IMT is calculatedUnder-35 exemptionPurchase processIMI (annual property tax)Common questionsTaxes on purchase
Buying property in Portugal triggers two taxes at the deed and one that recurs every year. IMT (Imposto Municipal sobre as Transmissões, the property transfer tax) is the big one, calculated on the higher of the price or the tax-registered value. Stamp duty (Imposto do Selo) adds a flat 0.8% on the same base. Then IMI (Imposto Municipal sobre Imóveis, the annual municipal property tax) arrives every year you own the place. Both purchase taxes are paid before the deed is signed; the notary will ask for proof.
How IMT is calculated
IMT for a main home in mainland Portugal uses progressive brackets, like income tax: purchases below a threshold (around 106,000 euros in 2026) pay nothing, then marginal rates climb through the brackets to 8%, with a flat rate applying to very expensive properties. Second homes pay from the first euro at slightly higher effective rates, and rustic land has its own flat rate.
A worked example at a typical price: on a 300,000 euro main home in mainland Portugal, IMT comes out at roughly 10,700 euros, an effective rate near 3.6% (use the current official table for exact figures), using the 2026 brackets. Stamp duty adds 2,400 euros (0.8%). Bracket edges shift with inflation each year, so run the current year's official table or any reputable IMT calculator for your exact figure rather than reusing someone's last-year number.
| Cost item on a 300,000 euro main home | Approximate amount |
|---|---|
| IMT (progressive brackets) | ~10,700 euros |
| Stamp duty (0.8%) | 2,400 euros |
| Notary, registration, legal fees | Commonly 1,000 to 3,000 euros |
Worked example
Sofia, 38, is buying a 300,000 euro apartment in Porto as her main home, using the approximate figures from the table above.
Sofia needs roughly 13,100 euros in cash on top of her deposit, plus notary, registration and legal fees commonly between 1,000 and 3,000 euros; were she 35 or under buying her first home, both tax lines would drop to zero under the exemption below.
Under-35 exemption
Since August 2024, buyers aged 35 or under purchasing their first permanent home benefit from a full exemption from both IMT and stamp duty up to a value cap, 330,539 euros on the mainland for 2026, with a partial exemption running up to roughly double that. The conditions matter: it must be your first own permanent residence, you cannot have owned a home in the previous three years, you cannot be someone's tax dependent, and the exemption is claimed before the deed. The measure remains in force in 2026; the cap tracks the IMT brackets and moves yearly, so confirm the current figure when you buy.
Purchase process
What belongs beside the deed
At the deed, keep payment evidence or the applicable exemption evidence ready.
- PeopleBuyer and seller identification, including NIFs.
- PropertyLocation, property register details and share being acquired.
- Tax evidenceIMT and stamp-duty payment or exemption documents.
Get a NIF first
Nothing happens without a Portuguese tax number, including the promissory contract. The NIF guide covers getting one from abroad.
File the IMT declaration
Before the deed, the Modelo 1 do IMT is filed (usually by your lawyer or the notary) declaring the purchase and computing the tax.
Pay IMT and stamp duty
Both are paid before signing, and the payment references go to the notary. Exemptions, including the young buyer one, are claimed at this stage.
Sign and register
The deed is signed, the property is registered in your name, and the tax office updates the ownership record that drives future IMI bills.
Common mistakes
- Budgeting the price alone. IMT and stamp duty are due in cash before the deed and cannot be rolled into the mortgage; without them the signing does not happen.
- Reusing last year's brackets. IMT bracket edges shift with inflation each year; run the current official table rather than a number from an old post.
- Ignoring the VPT. IMT is charged on the higher of the price and the tax-registered value; check the caderneta predial before assuming the price governs.
- Claiming the young-buyer exemption late. The exemption is claimed before the deed; discovering it afterwards leaves the tax paid.
- Forgetting the recurring bill. IMI arrives every year on the VPT, billed automatically from the year after purchase; budget it alongside the mortgage.
IMI (annual property tax)
IMI is charged yearly on the VPT, at a rate each municipality sets within a national band, currently 0.3% to 0.45% for urban property, with rustic land at 0.8%. The tax office bills it automatically in the year after acquisition, payable in one to three installments depending on the amount, typically falling in May, August, and November. First-time buyers of a modest main home can apply for a temporary IMI exemption, subject to value and income limits worth checking for your case. A separate additional tax, AIMI, applies to individuals whose aggregate Portuguese residential holdings exceed a high threshold, which most single-home owners never meet.
Common questions
Do foreigners pay more IMT?
The brackets do not ask for a passport. Rates differ by property use (main home versus second home) and residents get main-home treatment more easily, so a non-resident buying a holiday home pays the second-home scale.
Is the young buyer exemption available to foreign nationals?
Nationality is no barrier. The tests are age, first-home status, and the property becoming your own permanent residence, which points at moving here for real.
Can IMT be financed in the mortgage?
Banks lend against the property, and the taxes are due in cash before the deed. Budget IMT, stamp duty, and fees on top of your deposit.
What if I sell within a few years?
IMT is not refunded, and a sale raises its own capital gains questions. The selling your home guide covers the exit side, including reinvestment relief.
Sources
- Código do IMT and Código do IMI (rates, brackets, and exemptions)
- Decreto-Lei 48-A/2024 and gov.pt notice on the under-35 IMT and stamp duty exemption
- PwC Portugal 2026 state budget property tax notes and Your Overseas Home IMT 2026 guide (checked August 2026)
This guide is general information, not personalised tax advice. Rules and rates change, and your facts can move you off the defaults described here. Confirm your position with a qualified professional before acting on it.