Portugal IMT Exemption 2026: Zero Taxes for Young Buyers

Note: This content is specific to the Portuguese property market. Buying a home in Portugal involves two main taxes: the IMT (Property Transfer Tax) and Imposto do Selo (Stamp Duty). Stamp Duty on the purchase is 0.8% of the price. Since 1 August 2024, the Portuguese government has offered a major incentive for young people: a total exemption from IMT and Stamp Duty on the purchase of a main home, up to a price limit.

Who Qualifies?

To benefit from this exemption, you must meet the following criteria:

• Age: You must be 35 years old or younger on the date of the deed.
• Purpose: The property must be your Permanent Own Housing (HPP), used exclusively as your home. No holiday homes or buy-to-let. It must become your home within 6 months of purchase and stay that way for 6 years, with limited exceptions (for example, a sale, a change in household, or a job more than 100 km away).
• First-Time Buyer: You cannot own a residential property (including a share of one) on the purchase date or at any time in the three years before it.
• Income: You must not be considered a dependant for IRS (income tax) purposes in the year of the deed, and must not become one during the following six years.

The Savings

The full exemption applies to properties up to €330,539 on mainland Portugal, and up to €413,174 in the Azores and Madeira.

• Property Price: €300,000
• Standard IMT: ~€10,542
• Stamp Duty (0.8%): €2,400
• Total Savings: ~€12,942 If the property costs between €330,539 and €660,982 (or between €413,174 and €826,228 in the Azores and Madeira), you only pay taxes on the portion exceeding the lower limit.

Impact for Young Buyers

This measure is tied to the criteria above. If you are a young buyer, check each one against your own situation before you commit to a purchase. 👉 Portugal Mortgage Calculator: Check your IMT

How to Apply for the Exemption

Each buyer must file the declaration provided for in article 19(1) of the IMT Code (Código do IMT). For a couple, each spouse files their own declaration. You should consult a tax professional or lawyer to confirm the current procedure and documents.

Benefits for Young Families

The exemption is not only beneficial for individual buyers but also for young families. With the rising cost of living, it can be challenging for families to save for a down payment and cover the additional taxes. The exemption can help reduce the financial burden and make homeownership more achievable.

Key Takeaways

• The full IMT and Stamp Duty exemption applies to properties up to €330,539 (€413,174 in the Azores and Madeira)
• Partial relief applies up to €660,982 (€826,228 in the Azores and Madeira), and only on the part above the lower limit
• The exemption can save buyers about €15,324 at the full-exemption limit
• Buyers must meet specific criteria, including age, main-residence use, prior ownership and dependant status
• The exemption is beneficial for young families and individual buyers

Frequently Asked Questions

• Q: Who is eligible for the IMT exemption? A: Buyers who are 35 years old or younger on the deed date, who will use the home as their permanent residence, and who did not own a residential property on the purchase date or in the three years before it.
• Q: What is the maximum property price for the exemption? A: €330,539 on mainland Portugal, and €413,174 in the Azores and Madeira.
• Q: How much can I save with the exemption? A: Up to about €15,324 in IMT and Stamp Duty at the full-exemption limit on mainland Portugal.
• Q: Does the exemption also cover the Stamp Duty on the mortgage? A: No. The exemption covers the purchase only. Stamp Duty on the loan (0.6% for loans of five years or more) is not covered.

Conclusion

The Portugal IMT exemption 2026 is a game-changer for young buyers in Portugal. With the potential to save about €15,324, it's an opportunity that should not be missed. Whether you're a first-time buyer or a young family, this exemption can help you achieve your dream of homeownership in Portugal. Remember to consult with a tax professional or lawyer to ensure you meet all the requirements and follow the correct procedures.

Sources

• Code of IMT, art. 9: https://info.portaldasfinancas.gov.pt/pt/informacao_fiscal/codigos_tributarios/cimt/Pages/cimt9.aspx
• Code of IMT, art. 17: https://info.portaldasfinancas.gov.pt/pt/informacao_fiscal/codigos_tributarios/cimt/Pages/cimt17.aspx
• Stamp Duty Code, art. 7-A: https://info.portaldasfinancas.gov.pt/pt/informacao_fiscal/codigos_tributarios/selo/Pages/selo7a.aspx
• Decree-Law 48-A/2024: https://diariodarepublica.pt/dr/detalhe/decreto-lei/48-a-2024-874258288