Buying a property can represent a major decision, both financially and emotionally.
Our Buyer´s Handbook guides you through a step by step process, with information to ensure you make a
The second edition of Mapro's lifestyle magazine, The Scene. Your handbook to life in the Algarve and your guide to the local property market.
Requirements
Costs Non Habitual Resident (NHR)
Visas
DISCLAIMER Before purchasing your property, we encourage you to find out about the process and costs involved in the purchase. Choose a good lawyer. A lawyer with experience in this area will check the ownership of the property, taxation history and registered deeds, at the same time that an independent inspector analyzes the condition of the property.
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Buying Process
1 ST STEP
BE INFORMED & ENGAGE PROFESSIONALS
Purchasing a privately owned property in Portugal is a structured yet straightforward process when managed correctly. It is essential to understand the process, legal requirements, and associated costs. With the right legal and financial guidance, buyers can ensure a smooth transaction while securing their new investment with confidence.
Appoint an experienced local lawyer – They will verify the property's ownership status, taxation history, and, if applicable, the financial health of the company structure (if the property is held within a company).
Engage a qualified surveyor – They will conduct a full inspection of the property to assess its condition and identify any potential issues.
Understand the costs involved – These include taxes, legal fees, and notary fees.
2
ND
STEP DEFINE THE CONDITIONS OF SALE
In addition to agreeing on the purchase price, both parties should outline key terms and conditions, such as:
· Payment terms; Included fixtures, fittings, or furnishings; Timeline for completion; Any conditions that may affect the purchase (e.g., financing approvals or due diligence findings).
A well-defined agreement helps avoid potential disputes later in the process.
3 RD STEP PREPARE YOUR DOCUMENTS
To proceed with the purchase, the following documents and registrations are required:
Valid identification (passport or national ID); Portuguese Fiscal Number (Número de Identificação Fiscal – NIF ) for each title holder; Proof of residency status, which impacts the amount of property transfer tax - Imposto Municipal sobre as Transmissões Onerosas de Imóveis (IMT) payable; Proof of tax residency, including proof of employment or last employment details; Know Your Client (KYC) Declaration, a mandatory compliance document under the anti-money laundering regulation.
Buying Process
4 TH STEP PROMISSORY CONTRACT
(CONTRATO DE PROMESSA DE COMPRA E VENDA – CPCV)
Once all legal due diligence is complete and terms are agreed upon, a Promissory Contract (CPCV) is drafted and signed by both parties.
A 10% deposit is typically paid upon signing.
Under Portuguese law:
If the buyer defaults, they forfeit the deposit. If the seller defaults, they must refund double the deposit to the buyer.
The CPCV legally binds both parties to complete the transaction under the agreed conditions.
5 TH STEP FINAL DEED & OWNERSHIP TRANSFER (ESCRITURA DE COMPRA E VENDA)
The final stage involves executing the Final Deed (Escritura de Compra e Venda), which formalizes the property transfer.
Pre-signing requirements:
Payment of Property Transfer Tax - Imposto Municipal sobre as Transmissões Onerosas de Imóveis (IMT) must be made within 24 hours before signing; Stamp Duty (Imposto de Selo) will also be paid at this time; Remaining balance of the purchase price is prepared, usually with a banker’s cheque.
Signing the Deed - Escritura:
Conducted before a notary or at the local Land Registry Office (Conservatória do Registo Predial); The buyer makes the final payment.
Final Registration:
Once the deed is signed; Notary fees will be paid and the new ownership must be registered in the Land Registry (Registo Predial); The property’s records are updated with the new owner’s details.
CONGRATULATIONS ON THE PURCHASE OF YOUR PROPERTY!
Buying Costs
PURCHASE TAX (IMT) PRIVATE PROPERTY PURCHASE
The Property Purchase Tax – Imposto Municipal Transmissões Onerosas de Imóveis (IMT) is levied on the buyer before signing the final deeds and varies based on the property type and purpose.
a. Primary Residence IMT Rates
Up to € 648.022 � Taxed on a progressive scale (2% to 8%), with a deductible amount applied
€ 648.022 – € 1.128.287 � Flat rate of 6%
Over € 1.128.287 � Flat rate of 7.5%
Urban building plots � 6.5%
Rustic plots � 5%
Property with a touristic habitation license � 6.5%
IMT is calculated on the higher value between the purchase price and the rateable value.
b. Secondary Residence IMT Rates
Up to € 621.501 � Taxed on a progressive scale (2% to 8%), with a deductible amount applied
€ 621.501 – € 1.128.287 � Flat rate of 6%
Over € 1.128.287 � Flat rate of 7.5%
IMT is calculated on the higher value between the purchase price and the rateable value
c. Primary Residence for Buyers Under 35 (New Government Incentive)
Up to € 324.058 � IMT Exempt
€ 324.058 – € 648.022 � 8% tax minus a deductible amount of €25.924.64
€ 648.022 – € 1.128.287 � Flat tax of 6%
Over € 1.128.287 � Flat tax of 7.5%
IMT is calculated on the purchase price, however if this is lower than the rateable value (VPT), the higher value will be considered to calculate the IMT.
STAMP DUTY (IMPOSTO DE SELO)
Paid by the buyer.
Levied at 0.8% of the deed (escritura) value.
NOTARY FEES
The cost is calculated on a sliding scale depending on the property's value.
Notaries have a minimum fee set by law
REGISTRATION FEES
After signing the deed, the new ownership must be registered at the Land Registry Office
Cost: Around €250
LAWYERS FEES
Lawyers typically charge between 0.5% – 1% + VAT of the agreed purchase price.
SURVEYORS FEES
Fees depend on the service requested and the size of the property.
A full property survey is advisable.
Fees generally start at €1,000 + VAT.
Be clear on the level of detail you require in the survey.
Company Purchase
THE BUYING PROCESS
The purchase of a property held in a company structure follows a similar process to acquiring a privately owned property. However, additional due diligence is required on the company itself.
Additional steps in the buying process
1. Due Diligence
Local property title searches.
A thorough review of the company’s history, activities, financial accounts, warranties, and liabilities.
Share Purchase Agreement (SPA) / Share Transfer Agreement (STA)
This process follows two stages:
Promissory Agreement: A 10% deposit is typically required, setting terms and conditions with a defined completion deadline.
Final Agreement: The remaining balance is exchanged upon completion.
Ownership Transfer
The management company overseeing the corporate structure transfers share ownership to the new beneficiaries.
This transfer must be registered on the Ultimate Beneficiary Declaration Platform (Registo Central do Beneficiário Efetivo)
Required Documentation
Full identification.
Portuguese fiscal number (may not always be required for non-resident company structures).
Proof of primary address and employment.
Know Your Customer (KYC) compliance for anti-money laundering regulations.
Company Purchase
BUYING COSTS OF A COMPANY HOLDING A PROPERTY
Company Structure Jurisdictions
Company structures holding property are typically based in jurisdictions such as:
Malta
Delaware
Portugal (increasingly common)
All beneficial owners must be declared on the Ultimate Beneficiary Declaration Platform for full transparency. These structures are commonly used for estate planning and asset management.
BUYING COSTS OF A COMPANY HOLDING A PROPERTY
Legal & Surveyor Fees
Similar to a privately owned property purchase.
Taxes
Non-resident companies:
Exempt from Property Purchase Tax (IMT) and Stamp Duty.
Portuguese companies:
Exempt only if no beneficiary owns 75% or more of the shares. Spouses are not considered separate shareholders for exemption purposes.
Wealth Management Fees: Vary depending on the scale of services provided.
This structure offers tax efficiencies and estate planning benefits but requires professional legal and financial guidance to ensure compliance.
Mandatory Requirements
KNOW YOUR CLIENT (KYC)
The Know Your Client (KYC) process is a crucial compliance measure across various industries, particularly in banking, finance, and real estate. It is designed to verify customer identities, reducing the risk of fraud, money laundering, and terrorist financing while ensuring compliance with regulatory standards.
In an increasingly digital world where transactions often occur remotely, strong KYC protocols help safeguard financial systems and maintain the integrity of business dealings. Licensed real estate agents are required to follow KYC procedures, which involve collecting essential information from buyers and sellers. This includes official identification, proof of address, and, in some cases, additional details depending on the risk profile of the client. For instance, politically exposed persons (PEPs) may require further scrutiny.
All relevant details are compiled into a KYC form, which must be duly signed by both the buyer and the
Running Costs
ADDITIONAL MUNICIPAL PROPERTY TAX | ADICIONAL AO IMPOSTO MUNICIPAL SOBRE IMÓVEIS (AIMI)
Is an additional municipal tax introduced in 2017, applicable to residential properties and urban plots in Portugal. It is levied annually on properties with a rateable value (VPT) exceeding € 600.000 per person
The tax rates are structured as follows:
0.7% on the portion of the VPT exceeding € 600.000 but less than € 1.000.000
1.0% on the portion of the VPT between € 1.000.000 and € 2.000.000
1.5% on the portion of the VPT above € 2.000.000
This tax only applies to the excess value above each threshold.
KEY CONSIDERATIONS
Exemptions may apply if the property is classified as a primary residence
Properties held in white-listed companies are taxed at a flat rate of 0.4% on the total VPT.
Properties owned in blacklisted jurisdictions are subject to a significantly higher IMI rate of 7.5%
The AIMI is separate from the standard Municipal Property Tax (IMI) and is intended to target high-value properties.
Running Costs
ESTIMATED ANNUAL RUNNING COSTS 4 BEDROOM VILLA
IMI/AIMI
RESORT MEMBERSHIP
CLEANING SERVICES
GARDEN MAINTENANCE
POOL MAINTENANCE
ELECTRICITY
GAS
WATER
SECURITY / ALARM SERVICE
INTERNET
CABLE TV INSURANCE
PROPERTY MANAGEMENT TOTAL
Non Habitual Resident (NHR)
THE IFICI TAX REGIME IN 2025
The Tax Incentive for Scientific Research and Innovation (IFICI) — commonly referred to as NHR 2.0 —is a Portuguese tax regime aimed at attracting highly skilled professionals to the country.
Designed to foster innovation, digital transformation, and global competitiveness, this regime offers significant tax benefits to individuals working in qualifying professions or industries, reinforcing Portugal’s position as a hub for knowledge-driven economic growth.
Under the IFICI regime, eligible professionals benefit from a 20% flat tax rate on income derived from qualifying employment and self-employment activities for up to 10 years.
Additionally, income earned abroad—excluding pensions—is tax exempt in Portugal, provided it is declared for tax progression purposes. This includes passive income such as, dividends, interest, royalties, capital gains and rental income from property or other employment income, all of which are derived outside Portugal.
However, this regime is not available to individuals who have previously benefited from other special tax regimes, such as the Non-Habitual Residency (NHR) regime or the Return Program. Moreover, it can
Residency Visas
GOLDEN VISA
The Golden Visa program continues to offer residency to investors, with the following qualifying options:
Investment Funds A minimum investment of € 500.000 in qualifying Portuguese investment funds.
Job Creation Creation of at least ten jobs in Portugal.
Research Activities A capital transfer of € 500.000 or more for research activities conducted by public or private scientific research institutions.
Commercial Company Formation Formation of a commercial company in Portugal with a capital transfer of € 500.000 or more, combined with the creation of five permanent jobs.
It is important to note that as of October 2023, real estate investments no longer qualify for the Golden Visa program.
D2 VISA – ENTREPRENEURIAL VISA
The D2 Visa is designed for entrepreneurs who wish to start or purchase a business in Portugal. Key requirements include:
Business Establishment Evidence of setting up or acquiring a company operating in Portugal.
Financial Means Proof of sufficient funds to support both the business and personal living expenses.
Accommodation Proof of accommodation in Portugal, such as a rental agreement or property deed.
Health Insurance Valid health insurance covering the duration of stay.
Clean Criminal Record No criminal record in Portugal or the country of origin.
HQA (HIGHLY QUALIFIED ACTIVITY) VISA
The HQA Visa targets highly skilled professionals and entrepreneurs. Requirements include:
Higher Education A diploma from a recognised educational institution.
Employment Contract A work contract or a written promise of employment for at least one year, with a salary 1.5 times higher than the average gross annual salary in Portugal.
Clean Criminal Record No criminal record.
Health Insurance Valid health insurance.
Testimonials
SK BUYER - QUINTA DO LAGO
Sandra Neves sold a 5 bedroom house to us in Quinta Do Lago and if it wasn't for her the sale would have fallen over. She was incredibly knowledgeable, very responsive and pleasant to deal with. Furthermore, she was able to mediate between lawyers and navigate through a complex legal matter to find a solution that worked for all parties. If we sell our property I would definitely use Sandra. I couldn't recommend her enough!
GC BUYER - VALE FORMOSO
Excellent agent who was also recommended to us. helped us find our home with regular and easy communication throughout. Nothing was ever too much trouble. Would use again for sure, and also highly recommend to others. Made the process simple. Thanks Sam!
MP BUYER - QUINTA DO LAGO
Frederico Macieira from Mapro | Knight Frank guided us wonderfully through the purchase of our home in Portugal! Step by step, he led us through the entire process. A great experience. Thank you for your help, Frederico !
