Anyone buying property in Portugal faces three main taxes: transfer tax (IMT), the annual municipal property tax (IMI) and stamp duty (Imposto do Selo). For larger portfolios there is an additional tax (AIMI). Foreign buyers pay the same rates as Portuguese residents — there is no rate differentiation by resident status for IMT, according to the PwC Tax Guide Portugal 2025.
IMT — transfer tax
IMT (Imposto Municipal sobre as Transmissões Onerosas de Imóveis) is levied on the transfer of ownership and uses a progressive rate. For residential property in 2025, the rate climbs to 10% for amounts above €1,128,287, with a reduced rate of 8% for the bracket €324,058–€648,022 and lower rates below that. Commercial property is taxed at a flat 6.5%, rural property at 5%.
IMT is calculated on the higher of two values: the transaction price or the cadastral value of the property (Valor Patrimonial Tributário, VPT). Official rate tables are published by the Autoridade Tributária e Aduaneira.
IMI — annual municipal property tax
IMI is the annual municipal property tax. In 2025, the rate for urban property ranges between 0.3% and 0.45%, with a flat 0.8% for rural property. The exact rate is set by the municipality; Lisbon, for example, applies 0.3%, while smaller municipalities tend to be higher.
First-home owners can qualify for a temporary three to eight year exemption depending on VPT and family situation. Foreign buyers with a second home in Portugal do not qualify for this exemption.
Imposto do Selo — stamp duty
In addition to IMT, a one-off stamp duty of 0.8% applies to the transaction value. This is a separate levy settled in the same notarial deed.
AIMI — wealth tax on large portfolios
For individuals with a total VPT above €600,000, AIMI applies. The rate is 0.7% on the portion between €600,000 and €1,000,000, and 1% on the portion between €1,000,000 and €2,000,000. Above €2 million the rate is 1.5%. Companies holding property pay AIMI from the first euro at 0.4%, scaling up in the same brackets.
Rental income
Non-residents are taxed in Portugal on rental income. The standard rate is 28% on net income, with the option to choose the autonomous regime at 25%. Maintenance costs, IMI and notary fees are deductible. The full overview is on the Portuguese tax authority's portal.
Portugal–Netherlands tax treaty
The bilateral treaty between Portugal and the Netherlands prevents double taxation on real estate income. The principle: real estate is taxed in the country where it is located. The Netherlands grants relief on its own levy via the proportional exemption method in box 3 (see also our article on box 3 and foreign property).
End of the NHR regime
The well-known Non-Habitual Resident regime is largely closed to new applicants from 2024. Existing decisions remain in force under conditions. Since 2024, Portugal has the IFICI regime (Incentivo Fiscal à Investigação Científica e Inovação), offering favourable tax conditions for specific professions — a more narrowly defined successor to NHR.
Practical points
- A Portuguese tax number (NIF) is required for any property transaction.
- Non-EU buyers often appoint a tax representative, although the legal obligation has been relaxed since 2022.
- IMT and stamp duty must be paid before the notarial deed.
This article is informational. Tax rules and rates can change. Always consult a tax advisor familiar with both Portuguese and Dutch tax law for your specific situation.
Sources: Autoridade Tributária e Aduaneira · PwC Tax Guide Portugal 2025 · Portugal–Netherlands treaty