Selling property in Portugal: tips for overseas owners

What to consider before selling your home in Portugal

For many UK and other foreign property owners, selling a home in Portugal marks the start of a new chapter, whether that means returning to the UK, relocating elsewhere or simply restructuring long-term plans.

While the Portuguese property market is transparent and well regulated, selling a property there involves more than accepting an offer. Understanding the tax implications, documentation requirements and the financial impact of moving money across borders is essential for a smooth sale.

This guide outlines the major considerations to keep in mind before you begin the process.

Understanding capital gains tax when selling in Portugal

Selling a Portuguese property for more than you originally paid can trigger capital gains tax known locally as mais-valias. The gain is calculated by taking the sale price and deducting the original purchase price along with allowable costs such as estate agent fees, certain legal fees and documented improvement works.

Non-residents and residents are now broadly taxed under the same framework with 50% of the gain subject to Portugal’s progressive income tax bands. These range from about 14.5% to 48% depending on total income. Properties purchased before 1989 may be exempt and reliefs may apply where proceeds are reinvested in a qualifying primary residence.

Because tax rules can change and depend heavily on personal circumstances it is advisable to cross-check the latest information from the Autoridade Tributária e Aduaneira or consult a qualified tax specialist.

Taking the true cost of selling into consideration

Many sellers underestimate the combined cost of fees and administrative expenses. Building a realistic expectation from the outset helps avoid unwelcome surprises.

Estate agency commission

Most Portuguese estate agents charge between 3% and 6% of the sale price plus VAT depending on the level of marketing and service they provide.

Legal, notary and registry fees

Although buyers typically cover the bulk of the legal costs sellers still incur certain administrative fees. Notary and land registry charges usually fall between €500 and €1,500 depending on the complexity of the transaction.

Certificates and compliance

Sellers must provide an energy performance certificate and may need additional documents such as a habitation certificate or evidence of licensed renovation works. These require time and planning.

Preparing your documentation to avoid delays

Ensuring all documents are accurate and up to date is critical. You will usually need:

A valid title deed
Current Land Registry records
Proof of paid municipal taxes such as IMI
An energy performance certificate
Evidence of approved refurbishment work where applicable

If the property sits within a tourist development or managed complex specific rules on use classification or ownership may apply. Addressing any inconsistencies early helps prevent delays once a buyer commits.

Managing your sale proceeds across borders

For UK and other foreign sellers one of the most significant elements of the sale is converting the proceeds back into pound or another home currency. Exchange rates shift constantly and even a small fluctuation between the promissory contract and completion can materially impact how much you receive.

Working with a currency specialist can help mitigate this risk. Forward contracts and rate monitoring tools allow you to secure a rate in advance or plan transfers around more favourable market movements. This can make a meaningful difference when dealing with high-value transactions such as property sales.

Laying the groundwork before listing

Preparing thoroughly before putting your property on the market can save time and prevent complications. Reviewing the legal status of the property ensures documentation is complete and considering in advance how you will manage the currency transfer once the sale completes all set the foundations for a smoother process.

Conclusion

Selling a home in Portugal involves several moving parts from capital gains tax to administrative requirements and the financial considerations of repatriating funds. Approaching each step with clarity ensures the process is more efficient and puts you in a stronger position when negotiating a sale.

Written by Lumon for Rightmove

This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Lumon or its subsidiaries, and it is not intended as a substitute for obtaining advice from the relevant professional services. We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.