Capital gains tax on selling property in Portugal in 2026: residents and non-residents

Updated: 30 October 2026 · RE/MAX Extra

When an owner sells a property in Portugal for more than they paid for it, the profit is subject to IRS, the Portuguese income tax. The IRS Code calls this profit mais-valias (capital gains) and puts it in Category G. Below we explain how the gain is worked out, how much of it is taxed, what rates residents and non-residents pay and when no tax is due. Everything has been checked against the text of the IRS Code on the Portal das Finanças, the Portuguese tax authority's website, as it stood in October 2026.

How the gain is calculated

The formula comes from Articles 10, 44–46, 50 and 51 of the IRS Code:

• sale price (valor de realização): the amount in the contract. If the property's tax value, on which the buyer pays IMT (the property transfer tax), is higher than the price, the tax value is used instead (Article 44); the seller can prove they actually received less;
• minus the purchase price (valor de aquisição): the amount on which IMT was charged when the property was bought (Article 46). For an inherited or gifted home, it is the value on which stamp duty was charged (Article 45);
• the purchase price is multiplied by the currency devaluation coefficient if more than 24 months passed between purchase and sale (Article 50). The coefficients are approved each year by an order from the Ministry of Finance;
• minus the cost of improvements to the property over the last 12 years, such as renovation and reconstruction, if backed by documents (Article 51);
• minus the costs of buying and selling that were necessary and actually incurred, for example the taxes paid on purchase and the agency's commission on the sale (Article 51).

Costs are only accepted with paperwork: invoices showing the supplier's tax number (NIF), building contracts, proof of payment. Keep them from your first day as owner, because renovation work counts for 12 years.

The inflation coefficient

The coefficients are published at the end of each year and apply to that year's sales. For 2025 sales, the relevant order is Portaria No. 382/2025/1 of 11 November 2025. Some of its values:

Sales made in 2026 will have a new table, published nearer the end of the year, and its values may differ.

How much of the gain is taxed

Under Article 43 of the IRS Code, all gains and losses from selling property in the year are first added together. If the result is positive, 50% of it goes into the tax base. The whole gain counts in only one case: the property received non-repayable state support worth more than 30% of its tax value and was sold less than 10 years later.

Until 2023, non-residents paid 28% on the whole gain. Law No. 24-D/2022 abolished that rate, so half of a non-resident's gain is now taxed in the same way as a resident's.

Rates

The taxable 50% of the gain is added to your other income for the year, and the tax is worked out on the standard scale in Article 68 of the IRS Code. The 2026 scale (Law No. 73-A/2025):

Taxable income above €80,000 also pays a solidarity surcharge: 2.5% on the part between €80,000 and €250,000, and 5% on the part above €250,000 (Article 68-A).

Non-residents

A non-resident's gain from selling property in Portugal is also taxed on the scale (Article 22, paragraph 3). But the rate is set by taking into account all their income, including income earned abroad (Article 22, paragraph 10). So with a high salary in another country, the rate on the Portuguese gain will be higher than in the example below, which assumes no other income.

How the tax paid in Portugal is treated in your country of tax residence depends on the double taxation agreement between the two countries.

Worked example

A flat was bought in 2015 for €200,000, the amount on which IMT was charged. In 2026 it is sold for €380,000. For this example we use the 2025 coefficient of 1.20; a 2026 sale will have its own. The other amounts are illustrative:

With no other income in the year, the tax on the scale is as follows: €46,566 at the average rate of 26.472% comes to €12,326.95, and the remaining €2,434 at 44.6% comes to €1,085.56. The total is €13,412.51, or about 13.7% of the gain. With the same figures but other income on top, the tax will be higher.

When no tax is due

Buying a new main home

Paragraph 5 of Article 10 exempts the gain on selling your main home (habitação própria e permanente) if all of these conditions are met:

• the proceeds, less any mortgage repaid on that property, are invested in buying, building, extending or renovating another main home in Portugal or elsewhere in the EU or EEA (provided there is an exchange of tax information with that country);
• the investment is made in the window from 24 months before the sale to 36 months after it;
• the intention to reinvest and the amount are stated in the tax return for the year of sale;
• the home sold was your main home: the tax address of the seller or their household was there for the 12 months before the sale. The exception is a change in the family: marriage, divorce, the birth of children (paragraph 26);
• the new home becomes your main home within 12 months of purchase, and your tax address is registered there (paragraph 6).

If only part of the proceeds is reinvested, a proportional part of the gain is exempt (paragraph 12). If the proceeds could not be reinvested, tax is due on the part not reinvested. In the cases in paragraphs 9, 29 and 30, an amount equal to compensatory interest is added to it (paragraph 31).

A main home is the address where a person is tax resident, so in practice this exemption is open to Portuguese tax residents.

Investing in a home to let (2026–2029)

Decree-Law No. 97/2026 added paragraphs 7–9 to Article 10. They apply to sales from 1 January 2026 to 31 December 2029 and cover any home, not only a main home. The gain is exempt if:

• the proceeds, less any loan repaid, are invested in a home in Portugal that will be let as a residence;
• the investment is made in the window from 24 months before the sale to 36 months after it, and the intention is stated in the tax return;
• the tenancy agreement is signed within six months, and the rent is no more than 2.5 times the 2026 minimum wage, which is €2,300 a month;
• the home is let for at least 36 months in the first five years and is not sold for five years.

Pensioners and people aged 65 or over

Paragraph 10 of Article 10 exempts the gain on selling your main home if you or your spouse are retired or aged at least 65 and, within six months, you invest the proceeds in life insurance, a pension fund, the state savings scheme (regime público de capitalização) or the Pan-European Personal Pension Product (PEPP). Life insurance and pension funds carry a further condition: regular payments for at least 10 years and no more than 7.5% of the amount invested per year.

Homes bought before 1989

The IRS Code came into force on 1 January 1989. Under the transitional Article 5 of Decree-Law No. 442-A/88, income that was not subject to the former 1965 capital gains tax is only subject to IRS if the asset was bought after that date. Building plots and rural land have their own particularities, which are worth checking with an adviser.

How and when to declare

The sale goes in the annual IRS return (Modelo 3, Annex G) for the year of the transaction. The return is filed on the Portal das Finanças from 1 April to 30 June of the following year (Article 60). For a sale in 2026, that means 1 April to 30 June 2027. Non-residents file in the same way; to access the portal you need a tax number, and our guide NIF and a bank account in Portugal for foreigners explains how to get one.

Exemptions depend on the details: dates, tax address, the mortgage, who is in the household. Before signing the sale contract, it is worth working out the tax with an accountant or tax adviser.

Related articles

The taxes on buying and the annual taxes owners pay (IMT, stamp duty, IMI and AIMI) are covered in Property taxes in Portugal. What it costs to own a home each year is in The cost of owning property in Portugal. The steps of a purchase are in How to buy property in Portugal as a foreigner.

If you are planning to sell, tell us about your property and a RE/MAX Extra agent will get in touch. If you need to reinvest the proceeds in a new home, take a look at flats in Lisbon, houses in Cascais and new developments.

This article is for information only and is not legal or tax advice. Rates and rules change — always check official sources and a professional before a transaction.