Description
NIF - Tax Identification Number -
In order to purchase a property in Portugal, you will need to obtain a "Tax Identification Number", which can be issued by any local tax office.
This number is also required to open a bank account in Portugal and to make payments related to the property, such as water, electricity, etc.
Due to new rules relating to tax evasion and money laundering, your lawyer may advise you that foreigners wishing to own property in Portugal may need to appoint a fiscal representative in the country. Your lawyer will be able to provide guidance on this matter.
Will –
If you own a property in Portugal, you may wish to consider making a Portuguese will, even if you already have a will in your country of origin.
A Portuguese will may help to facilitate the inheritance process for those who will eventually inherit the property.
Inheritance Tax -
Portugal does not have an inheritance tax. Inheritances between spouses, children and parents are exempt from Stamp Duty. For other beneficiaries, Stamp Duty may apply at a rate of 10%.
These rules also apply to properties located in Portugal owned by non-residents.
Residency -
If you reside permanently in Portugal or stay in the country for more than 183 consecutive days per year, you may need to apply for a residence permit.
This is an identification document confirming your legal residence in Portugal. The requirements and rights associated with residency depend on your nationality and individual circumstances.
Obtaining residency will not make you a Portuguese citizen and does not mean that you will have to give up your current nationality.
Taxes
Below are the taxes involved in the purchase of a property.
IMT - Property Transfer Tax - is the tax on the transfer of property ownership and is paid to the Portuguese State immediately before the contract is completed.
For the purchase of a property intended for residential use, the IMT rate varies according to the value of the property, with the current threshold below which no IMT is payable being €106,346.00 for residents.
For non-resident buyers, the purchase of a property intended for residential use is subject to a fixed IMT rate of 7.5%, regardless of the value of the property.
For the purchase of "land", a rate of 5% for rural properties and 6.5% for other urban properties applies, regardless of the sale value.
Stamp Duty - is also payable on the purchase of a property, at a rate of 0.8% of the purchase value.