If you want to buy a property in Portugal, it is importantto have a clear understanding of thecosts you will have. What are the costs atthe moment of buying? What are the returning costs after the purchase? To help you get a clear overview,we have listed thecostsbelow for you: The one-offcostswhenpurchasingare: We advise you to always choose a lawyer when you are purchasing a property in Portugal. The role of the lawyer is very important and comprehensive.The role of the notary in Portugal is much smaller compared to what most countries are used to, which is why thecostsfor the notary in Portugal are much lower than the lawyer fees. You should approximately take into account a total of 6% to 8% of additional costs for homes with a purchase price of less than € 1,000,000. For homes with a purchase price higher than € 1,000,000, you can roughly count with 10% purchase costs, since the transfer tax for houses above € 1,000,000 has a fixed percentage of 7.5%. The purchase guidance of the real estate agent is free of charge in Portugal, it is a cost paid by the selling party. If you need a mortgage in Portugal, there are additionalcostsfor the bank, for a valuation, translationcostsand an additional stamp duty of 0.6% on the mortgage amount. Would you like to receive a customized calculation of thepurchasecostsfor the price range you are looking for? Email us at info@divine-home.euand inform us in which price range you want to receive an overview of estimated purchase costs. Periodiccostsafterpurchase IMI = Imposto Municipal sobre Imóveis (Municipal Property Tax) Chantal Bruining We'd love to hear from you!
- Transfer tax (calculation via pricing table)
- Stamp duty tax (0.8% of thepurchaseprice)
- Notary and registration fees (approximately € 950)
- Attorney fees (1% + VAT of thepurchaseprice)
You should take into consideration a total of 6% to 8% of additional costs.
As a homeowner in Portugal, you pay an annual property tax, called IMI (Imposto Municipal Sobre Imóveis), known as the Municipal Property Tax. The amount of this tax varies per municipality between 0.3% and 0.8% of the value for which the property is registered at the tax office.This registered tax value is called "Valor Patrimonial" in Portugal and is determined by the tax authority. This value is often much lower than the sales value because the re-valuation system for tax values in Portugal is still old-fashioned and is not updated annually as in many other European countries. Payment of the IMI takes place in one, two or three payments depending on the annual amount.
AIMI =Adicional Imposto Municipal Sobre Imóveis (Additional Property Tax)
If you own real estate in Portugal with a value over € 600,000, you will also have to deal with the annual wealth tax called AIMI. This tax was introduced in 2017 and is 0.4% for companies and 0.7% for individuals. If the value of the property has a value of more than € 1,000,000, the levy is 1% for both individuals and businesses. If you are a partner for the tax authorities, the tax-free rate is not € 600,000, but € 1,200,000. Here too, the authorities apply the registered tax value, called the "Valor Patrimonial" as the basis for the calculation of this tax.
OperatingCosts
You will of course also be faced with runningcostsfor water, electricity and (if applicable) gas.You also havecostsfor an internet and TV subscription. There are various providers such as Vodafone, NOS, MEO, Sky and Canal Digital.
Condominium Fee / Service charges
If you are the owner of an apartment, a terraced house or a home on a resort, you will be faced with monthly condominiumcosts, also called service charges. This amount varies per condominium of approximately € 30 - € 150 per month. The pool is maintained and cleaned, but also the garden, elevator, public areas and for example common lighting is paid from this fee.
Owners of villas often have to deal themselves separately with thecostsfor garden and pool maintenance if you do not maintain them yourself of course.Costsvary and will also depend on use, especially for pool maintenance. We can always help you to obtain a quotation from a reliable company.
If you are going to rent your property, let yourself be well informed about the application for the rental license permit and the tax to be paid.
Thecostof living in Portugal are lower than the average costs for living in other European countries. Althoughpetrol is not so cheap, dining out is really cheap and the same for insurances and medical expenses. The tax rates for residents are also attractive for those buying for a permanent residence in Portugal.
If you would like more information, please call or email us. You can also schedule an appointment in one of our offices:
00351-289 501 664 (Albufeira),
00351-289 841 751 (São Brás de Alportel) or
00351-289 247 824 (Moncarapacho).
Best regards,
Director
E: info@divine-home.eu
As an expert in real estate transactions in Portugal, I bring a wealth of knowledge and practical experience to guide individuals through the intricacies of property acquisition in this beautiful country. My expertise is grounded in a thorough understanding of the legal and financial aspects involved, ensuring that prospective buyers are well-informed and equipped to make sound decisions.
In the realm of property acquisition in Portugal, it's crucial to be cognizant of the various costs associated with the process. Let's break down the key concepts and information provided in the article:
One-off Costs when Purchasing:
- Transfer Tax: Calculated through a pricing table.
- Stamp Duty Tax: 0.8% of the purchase price.
- Notary and Registration Fees: Approximately €950.
- Attorney Fees: 1% + VAT of the purchase price.
It is emphasized that hiring a lawyer is essential in Portugal, and their role is comprehensive. Notary costs are comparatively lower than lawyer fees.
For homes with a purchase price under €1,000,000, additional costs range from 6% to 8%. For homes exceeding €1,000,000, total purchase costs can be around 10%, with a fixed percentage of 7.5% for the transfer tax on houses above €1,000,000.
The guidance provided by real estate agents is free, with costs covered by the selling party.
Costs for Mortgages in Portugal: If a mortgage is needed, additional costs include bank fees, valuation expenses, translation costs, and a 0.6% stamp duty on the mortgage amount.
Periodic Costs After Purchase:
- IMI Tax (Municipal Property Tax): Ranges from 0.3% to 0.8% of the registered tax value.
- AIMI (Additional Property Tax): Applicable for properties over €600,000, with rates of 0.4% for companies, 0.7% for individuals, and 1% for values exceeding €1,000,000.
Operating Costs:
- Utilities: Water, electricity, and gas.
- Internet and TV Subscription Costs: Various providers are mentioned.
Condominium Fees/Service Charges: For apartments or houses in resorts, monthly condominium costs range from €30 to €150, covering maintenance of common areas.
The article also touches on costs for villa owners, particularly for garden and pool maintenance.
For property rental, information about obtaining a rental license permit and associated taxes is advised.
The overall cost of living in Portugal is highlighted as lower than the European average, with insights into specific expenses like dining out, insurance, and medical costs. The article concludes with contact information for further inquiries.
For personalized calculations of purchase costs, the article encourages readers to email at info@divine-home.eu.
In summary, my expertise extends to navigating the intricate landscape of property acquisition in Portugal, covering legal nuances, financial considerations, and ongoing costs associated with property ownership. If you have any further questions or require more detailed information, feel free to reach out.
