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Decree-Law No. 97/2026, published on 20 May, introduced one of the most significant changes to Portugal’s Property Transfer Tax (IMT) in recent years: a flat 7.5% rate for non-resident buyers purchasing residential property. The measure took effect on 25 May 2026.
If you’re planning to buy a home in Portugal and you’re not a tax resident, this article explains exactly what changes, how much you’ll pay, and what alternatives you have.
What changes on 25 May 2026
Until 24 May 2026, non-resident buyers pay exactly the same IMT rates as residents — the normal progressive brackets, with deductions, without any surcharge. From 25 May, the landscape shifts dramatically:
- Flat 7.5% rate on the property value, from the very first euro
- No progressive brackets — normal deductions don’t apply
- No exemptions — even for low-value properties, IMT is always due
- No primary residence reductions — the rate is the same for any use
The rule is based on tax residence, not nationality. A French citizen living in Portugal pays normal rates. A Portuguese citizen living abroad pays the 7.5%.
The three price zones: where does it hurt most?
The impact of the new rule is not uniform across all price points. The normal IMT for residents uses progressive brackets that result in very different effective rates depending on the property value. Understanding these zones helps with planning:
Zone 1: Up to €660,000 — The biggest impact
Residents benefit from progressive rates with deductions (effective rates of 2% to 6%). Non-residents pay 7.5% flat. The difference is around €10,000 to €11,000 extra across almost this entire range.
Zone 2: €660,000 to €1,150,000 — Moderate impact
Residents pay a flat 6% (no deductions at this level). Non-residents remain at 7.5%. The difference rises to €10,000 to €17,000, increasing with the price.
Zone 3: Above €1,150,000 — Zero effect
Both residents and non-residents pay a flat 7.5%. The non-resident surcharge disappears — you pay exactly the same as a Portuguese tax resident.
Real numbers: what you pay in each scenario
| Property Price | Resident IMT | Non-Resident IMT (7.5%) | Extra Cost |
|---|---|---|---|
| €200,000 | €4,606 (2.3%) | €15,000 | +€10,394 |
| €300,000 | €11,606 (3.9%) | €22,500 | +€10,894 |
| €400,000 | €19,300 (4.8%) | €30,000 | +€10,700 |
| €500,000 | €27,300 (5.5%) | €37,500 | +€10,200 |
| €700,000 | €42,000 (6%) | €52,500 | +€10,500 |
| €900,000 | €54,000 (6%) | €67,500 | +€13,500 |
| €1,100,000 | €66,000 (6%) | €82,500 | +€16,500 |
| €1,200,000 | €90,000 (7.5%) | €90,000 | €0 |
| €2,000,000 | €150,000 (7.5%) | €150,000 | €0 |
Values for secondary home/investment in Mainland Portugal. Source: IMTcalc.pt
Exceptions: how to avoid or reclaim the 7.5%
The decree-law itself provides two mechanisms to nullify the surcharge:
1. Become a tax resident in Portugal
If, within two years of purchase, you become a tax resident in Portugal, you can request the Tax Authority to refund the difference between the 7.5% paid and the normal progressive rates. In practice, the additional IMT functions as a refundable deposit.
2. Moderate-rent residential leasing
If you allocate the property to residential leasing with rent up to €2,300/month (2.5× the 2026 minimum wage), you can also recover the difference. Requirements:
- Sign a lease agreement within 6 months of purchase
- Maintain the lease for at least 36 months within the first 5 years
Which properties are affected?
The 7.5% rate applies exclusively to urban buildings intended for housing (or autonomous units). Building plots, commercial properties, rural land, and non-residential properties are not affected — they continue to follow the normal IMT rates for all buyers.
The context: the Government’s housing package
The IMT change for non-residents is part of a broader package of housing tax measures (DL 97/2026) that includes:
- VAT at 6% on construction and refurbishment works for properties destined for primary residence or rental (subject to price and rent limits)
- Reduced 10% taxation on rental income from moderate-rent leases
- IRS rent deduction rises to €900 in 2026 and €1,000 in 2027
- New simplified affordable housing regime
- Investment contract for rental housing with benefits up to 25 years
- IMT exemption for first purchase of cost-controlled housing (up to €106,346)
Key deadline: 25 May 2026
DL 97/2026 took effect on 25 May 2026, just 5 days after its publication. This means:
- Deeds signed from 20 May 2026: the 7.5% flat rate already applies to non-residents
- The period between publication (20 May) and entry into force (25 May) was only 5 business days
Use our IMT calculator
We’ve updated our IMT calculator with the new “Non-Resident” option. Simply select your tax status to see exactly how much you’ll pay — and compare with the resident scenario.
Request your free simulation now and find out how much you can save on your mortgage.
Sources:
- IMTcalc.pt — IMT for Non-Residents
- Decree-Law No. 97/2026, of 20 May
- Clarification: Did it take effect in May or only on 1 September?
Planning your purchase? See the full guide on mortgages for foreigners in Portugal — including bank approval, documents and LTV for non-residents.