T05E - IMT

Note: These guidelines are intended only as a summary. Tax laws and regulations change frequently and sometimes unexpectedly.  It is strongly recommended that you seek professional advice.

The Government has increased 2.3% in the Municipal Transfer Tax (IMT) brackets for the acquisition of an urban building or independent fraction intended exclusively for housing. The number of IMT tax brackets and their rates remain the same in 2025.

The IMT tables vary according to the purpose of the acquired housing. The IMT rates are lower if the property is destined to own and permanent housing, and higher if it is secondary housing or lease.

Municipal Transfer Tax
IMT - Imposto  Imposto Municipal sobre Transmissões Onerosas de Imóveis is levied on the transfer for consideration of ownership rights or of partial ownership on real estate (immovable property).

The taxable person is the person who acquires the property. The payment of this tax must be done at any tax office before the purchase is completed as the document proving its payment is one of the documents required for the Deeds, unless there is an exemption (see below). Or it can be done online on the Finanças website after logging into your personal area:

Cidadãos > Os Seus Serviços > Entregar > Declarações > IMT > Declaração. You need to fill in a form called Modelo1 IMT.

If the transfer takes place abroad, the tax must be paid during the following month.

There is a youtube tutorial in Portuguese on the AT channel with instructions how to pay this together with your Imposto de Selo (Stamp Duty): View video on Youtube.

From 1:45 it is easier to follow, but we suggest you ask a lawyer, realtor, accountant or friend that speaks Portuguese to assist you with this.

Exemptions
Among the different exemptions of both an effective and personal nature provided for different purposes are the following:

• Acquisitions made by the State, the Autonomous Regions, local authorities and associations and Federations of municipalities under public law, as well as any of their Services, establishments and bodies, even if personalized, including public institutes, which do not have a business character

• Acquisition made by Real Estate Investment Funds 100% owned by the State, by the Autonomous Regions, local authorities and associations and Federations of municipalities under public law, as well as any of their Services, establishments and bodies, even if personalized, including public institutes, which do not have a business character

• Acquisition by foreign Governments of property exclusively affected to the respective diplomatic or consular missions or designed to the domicile of the head of such mission or consul, as well as land for its construction, subject to reciprocity

• Purchase of real estate property for resale under certain conditions, mainly done by individuals or Companies with resale activity

• Acquisition of property by a legal person of public utility or of administrative public utility, a museum, library, school, teaching, educational, cultural, scientific, literary or artistic, charitable or social welfare institutions or associations, if designed to the direct and immediate achievement of their aims

• Acquisitions made by Private social solidarity institutions and entities Legally equivalent, direct and to fulfill its statutory purposes.

• Acquisitions made for religious purposes by legal persons Religious, as such registered under the law governing freedom of Religious.

• The purchase of rustic buildings on the first purchase made by Young farmers who are candidates for subsidies according to the applicable legislatio.

• The acquisitions of buildings already classified as buildings of National interest, of public interest or of municipal interest, in accordance Applicable legislation.

• Acquisitions located in areas economically disadvantaged, when carried out by commercial or civil companies, to be used for the exercise in those regions in Agricultural or industrial activities considered essential to economic and social development of the region. 

• Acquisitions of urban buildings for urban rehabilitation under certain requirements provided that, within a period of three years from the date of purchase, the purchaser commences the respective works. The areas for rehabilitation are determined by each Town Hall. 

• Acquisition of urban property or an autonomous fraction thereof intended exclusively for housing purposes as main residency, provided that the amount on which the tax would be levied does not exceed  €104,261.00 (€130,326 for Madeira and Azores).

• Buildings with low asset value, intended for own permanent residence, for low-income taxpayers as long as the gross income total household value does not exceed 2.3 x 14 IAS.

• An IMT exemption (and Stamp Duty) for acquisitions up to 324,058 euros* or a partial exemption (with a rate of 8% levied and adjustment band of 25,924.64 euros) for acquisitions above 324,058 euros and up to 648,022 euros. Between 648,022.01 euros and 1,128,287 euros a flat rate of 6% and above 1,128,287 euros a flat rate of 7,5%, for young people up to the age of 35, who buy their first home, came into force on the 1^st of August 2024.

  * For Madeira and the Azores this amount is 405,073 euros (with a rate of 8% levied and adjustment band of 32,405.80 euros for amounts from 405,073 euros until 810,028 euros). Between 810,028.01 euros and 1,410,359 euros, a flat rate of 6% and above 1,410,359 a flat rate of 7,5%

  This exemption is granted on the first acquisition of a property intended exclusively for own and permanent residence, being a condition that the young buyers are not owners of any residential property on the date of transfer or at any time in the previous three years and that they are not considered dependents for IRS purposes.

As a general rule, IMT must be paid on the settlement day or on the 1st following business day.

If payment is not made within this period, the documents will remain without effect and in order to carry out the deed of purchase, you must carry out new settlements and then make the respective payment.

Tax Base
The transfer tax ("IMT”) is levied on the value for which the property in question is transferred. Such value shall be determined in accordance with the following rules:

1. Normally, the value on which the tax is based is the purchase value, unless the “Valor Patrimonial” which the value registered at the fiscal office at the date of tax assessment is higher.

2. Whenever a valuation is carried out, the value resulting thereof shall be taken into account and shall prevail unless its price is higher.

3. There are some special rules concerning, in particular, property acquired by the Government and its local authorities, by way of forced or administrative auction, or expropriated for public utility purposes. 

Rates
The general rate is 5% on the transfer of land (prédio rústico) without building permission. Plots of land with licence to build as well as garages and commercial properties are taxed at a flat rate of 6.5%.

Buildings (urban or rural) or other acquisitions, of which the purchaser is resident in a country, territory or region subject to a clearly more favourable tax regime: 10%.

To pay this tax you should bring the Identification of both buyers and sellers, Fiscal numbers of all parts as well as “caderneta predial” or any document with the registration number of the property.

Below the rates for 2025:

To find out how much you have to pay if you are purchasing a property this year and according to the tables above, the purchase price is multiplied by the marginal rate and the adjustment band is deducted from the result. 

To simplify this explanation, we have taken as an example a property to be purchased as a permanent residence for €250,000.00 by 1 person over 35 years old.

As you can see the purchase price of €250,000.00 falls on the 4th bracket, therefore the purchase price is multiplied by 7% (the marginal rate) from the result you deduct the amount in the same line. 

(€250,000.00 x 7%) - €10,252.92 = €7,247.08

In this case the IMT to pay would be €7,247,08

There will be also Stamp duty of 0.8% on the purchase price or tax value (whichever is the highest) to be paid on the purchase.

€250,000.00 x 0.8% = €2,000.00

Total to pay: 9,247.08€

When located in the Autonomous Regions of the Azores and Madeira, you may benefit from reduced rates. These are the rates for the autonomous regions of Madeira and Azores for 2025:

Information on extraordinary IMI and IMT exemptions for the islands should be consulted in each municipality.

If the purchaser is a legal person resident in a country, territory or region subject to a clearly more favourable tax regime (Tax haven black-listed + 1 revoked), the IMI, IMT and Stamp Duty rates will have an increased rate. Please ask your tax advisor.