Before moving on, you should know that the concept of property used in Portugal is "full ownership", which is based on the full and exclusive right to use, enjoy and have immovable property at your disposal. This right gives the Portuguese property system an important competitive advantage.
IN THE AREA OF TAX LAW, YOU SHOULD KEEP IN MIND RELEVANT INFORMATION ABOUT TAXES, RATES AND BENEFITS APPLICABLE TO WEALTH.
The Municipal Tax on the Transfer of Property for a Valuable Consideration and Stamp Duty is charged on the acquisition of property.
What is the Municipal Tax on the Transfer of Property for a Valuable Consideration?
It is a tax charged on the transfer, for a valuable consideration, of property rights over immovable property or parts of this right (use and habitation, surface rights, usufruct, among others).
What is this tax applied to?
It is applied to the value of the purchase contract or to the taxable value of the property, whichever is greater.
The tax is the result of the application of variable rates which, in the case of property exclusively for residential use, can vary between 0 and 6%. Property located in the Autonomous Regions of the Azores and Madeira benefits from reduced rates.
What is Stamp Duty?
It is a tax applied to all acts, contacts, documents, deeds, papers and other legal factors or situations, including the transfer of goods free of charge. In the case of property purchases, it is applied to the value of the purchase contract, or to the taxable value of the property, whichever is greater. It is the result of the application of a 0.8% rate.
What is Taxable Value?
It is the value registered in the property register on the date of sale. In this register appears the description of the property, its location, its taxable value and the identity of its owners. Registers are updated annually on December 31.
Who is responsible for paying the taxes?
The interested party purchasing the property.
When should these taxes be paid?
They should be paid before the property purchase document is signed. If the transfer of ownership occurs overseas, the tax must be paid during the following month.
How are the taxes paid?
They can be paid by visiting any Finance Service Office, through the Finance Website or at a Casa Pronta service desk.
THIS INFORMATION IS NOT INTENDED TO BE A SUBSTITUTE FOR CONSULTING THE APPLICABLE LEGISLATION