&lt;p&gt;If you&#39;re planning to buy a &lt;a href=&quot;https://www.idealhomesportugal.com/property-for-sale/portugal&quot;&gt;property in Portugal&lt;/a&gt;, then you&#39;ll need to factor property taxes into the final cost. It doesn&#39;t matter if you&#39;re buying a property to live in yourself, or if you&#39;re looking for a second home or an investment opportunity, there&#39;ll be specific costs you&#39;ll have to pay related to your particular situation. This quick introduction to Portugal property taxes should give you a basic understanding of what you can expect to pay.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Immovable Property Tax (IMI)&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;Portugal&#39;s IMI is the equivalent of council tax in the UK and is something you&#39;ll have to pay as the owner of a property. What you&#39;ll pay depends on a couple of factors such as where the house is located or what kind of house it is. Similar to the UK, each municipal area in Portugal has a different rate of IMI set locally with the funds used to finance local infrastructure or community projects.&lt;/p&gt;
&lt;p&gt;The tax is collected annually at the end of the tax year and rates typically vary between 0.3% and 0.4% of the property value, unless you buy property in a rural area, in which case it will be more like 0.8% of the total property value.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Stamp Duty&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;Like in the UK, you&#39;ll pay stamp duty on your property purchase on deeds, contracts, loans and documents. The amount of stamp duty you&#39;ll pay will depend on the type and final value of the property you buy. Generally you&#39;ll be paying between 0.4% and 0.8% of the property value in stamp duty.&lt;/p&gt;
&lt;p&gt;You&#39;ll pay this tax when signing the deed of sale if you buy the house outright. If you&#39;re taking a mortgage to buy the property then you&#39;ll also need to pay stamp duty, usually at a rate of 0.6%, although it could be less if your mortgage will be paid off sooner.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Property Purchase Tax&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;Portugal&#39;s Property Purchase Tax (IMT) is paid when you buy your house. Like stamp duty, the rate of purchase tax you&#39;ll pay depends on the type and value of the property. The tax is worked out based on the value of the property declared in the deed or the rateable value - whichever is more.&lt;/p&gt;
&lt;p&gt;There are three basic criteria to consider that will help you work out how much purchase tax you&#39;ll pay:&lt;/p&gt;
&lt;p&gt;• The property type&lt;/p&gt;
&lt;p&gt;• Where it is&lt;/p&gt;
&lt;p&gt;• Whether it&#39;ll be your main residence or a second home&lt;/p&gt;
&lt;p&gt;There are some circumstances when IMT won&#39;t be payable. For example, if you&#39;re purchasing the property with the intention of renting it out.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Wealth Tax&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;If you own or have a share in a Portugal property worth more than 600,000€ then you&#39;ll be liable to pay a wealth tax. If you&#39;re an individual then you&#39;ll pay a rate of about 0.7%, or 1% of the property value on homes worth more than 1,000,000€. There are some exemptions you could apply for.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Tax on rental income&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;If you&#39;ve bought a property in Portugal as a holiday home and plan to rent it out during some parts of the year, then you&#39;ll pay tax on the rental income you make. You&#39;ll pay this regardless of whether you live in Portugal or remain in another country. This tax is charged at a flat rate on the net rental income you earn.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Capital Gains tax&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;If you sell a property in Portugal then you&#39;ll pay Capital Gains based on the final sale price. This is only applicable to any gains made on property deals or investments. If you own the property but aren&#39;t a permanent resident in Portugal then you&#39;ll usually pay a flat rate of 28% on the value of the sale. These gains will be added to your other income made throughout the year (like your taxable salary) and then you&#39;ll pay based on the level of income tax you fit into.&lt;/p&gt;
&lt;p&gt;You can, depending on your circumstances, be exempt for all or part of the capital gains liabilities from selling a property.&lt;/p&gt;
&lt;p&gt;For example, if you&#39;re a resident and pay tax in Portugal and are selling your main home to fund the purchase of another property.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;&lt;em&gt;Looking for the best property investment in Portugal&lt;/em&gt;&lt;/strong&gt;&lt;/p&gt;
&lt;p&gt;This guide should have given you a good idea of what you can expect to pay when you buy a property in Portugal when it comes to taxes.&lt;/p&gt;
&lt;p&gt;Obviously, the final amount you&#39;ll pay will be determined by the house you buy and your individual circumstances.&lt;/p&gt;
&lt;p&gt;If you&#39;re looking for a house in Portugal, either as a new home or something as an investment property, have a look at the latest &lt;a href=&quot;https://www.idealhomesportugal.com/property-for-sale/algarve&quot;&gt;properties for sale in the Algarve&lt;/a&gt;, and get in touch so our team can help with your search.&lt;/p&gt;

Guide to Portugal property taxes

What do you need to know about Portugal property taxes? Let’s start with this quick guide.