Buying Property in Portugal: A UK Buyer's Complete Guide

Can UK Nationals Still Buy Property in Portugal?

Yes, absolutely. Brexit has not restricted the ability of UK nationals to purchase property in Portugal. There is no restriction on foreign nationals — from any country — buying property in Portugal. The legal framework for property purchase is the same for UK buyers as for buyers from any other non-EU country, with the same rights to purchase, own and rent out property.

What Brexit has changed is the residency situation. UK nationals can no longer simply live in Portugal indefinitely as EU citizens. A stay of more than 90 days in any 180-day period requires a visa or residency permit. For buyers who plan to use their property primarily as a holiday home (most of the people we work with), this is not a significant practical issue — they typically stay well within the 90-day window.

For those wishing to become full Portuguese residents, the D7 visa (passive income visa) is the most popular route for UK retirees and remote workers with foreign income. Portugal's Non-Habitual Resident (NHR) tax regime — now modified under the IFICI regime — offers significant tax advantages to new residents in certain qualifying categories.

Step 1: Getting a NIF Number (Número de Identificação Fiscal)

The NIF is your Portuguese tax identification number, and it's absolutely essential for any financial transaction in Portugal — including buying property. Without a NIF, you cannot:

• Sign a purchase contract
• Open a Portuguese bank account
• Pay utility bills in your own name
• Submit tax returns (required even for non-residents who own Portuguese property)
• Apply for a Portuguese mortgage

How to get a NIF: Non-residents can apply at any Portuguese tax office (Finanças) in person, presenting their passport and proof of address. You can also appoint a Portuguese solicitor to obtain one on your behalf before you travel — this is the most convenient approach for UK buyers who are not yet in Portugal. Some specialist UK-based services also offer NIF registration assistance.

Non-residents who are not EU/EEA nationals (which includes UK nationals post-Brexit) technically need to appoint a fiscal representative in Portugal. In practice, many buyers proceed without one for property purchases, but it's worth discussing with your solicitor.

Step 2: Engaging a Portuguese Solicitor

Portuguese law requires a licensed advogado (solicitor) to oversee property transactions. Unlike in England and Wales where you can technically use a licensed conveyancer, in Portugal this must be a fully qualified lawyer. Do not use just any lawyer — use one who specialises in property transactions and ideally has experience working with foreign buyers.

There are several UK-based law firms with Portuguese-law capabilities. There are also many English-speaking Portuguese solicitors, particularly in the Algarve (which has a well-established expat legal services market), Lisbon and Porto. Expect to pay 1–1.5% of the purchase price in legal fees, plus disbursements.

Your solicitor will conduct due diligence on the property (checking for debts, planning issues, ownership disputes), verify the vendor's right to sell, draft and review all contracts, calculate your tax liabilities, and guide you through the completion process.

Step 3: The CPCV (Promissory Purchase Contract)

Before the final deed of purchase (escritura), Portuguese property transactions typically involve a preliminary contract called the Contrato de Promessa de Compra e Venda (CPCV). This is a legally binding agreement between buyer and seller that commits both parties to the transaction.

Key features of the CPCV:

• Deposit: Typically 10–30% of the agreed purchase price is paid on signing the CPCV
• Double deposit rule: If the vendor withdraws, they must return double the deposit. If the buyer withdraws, they lose the deposit. This provides strong commitment incentives on both sides.
• Completion date: Sets the date by which the final escritura must be signed
• Conditions: Any conditions (e.g., subject to mortgage approval) must be clearly stated

The CPCV is typically signed 4–8 weeks before the final completion. For new-build properties (off-plan), the CPCV may be signed months or years before completion, with stage payments along the way.

Step 4: Taxes and Costs

Buying property in Portugal involves several significant costs beyond the purchase price:

IMT (Imposto Municipal sobre Transmissões)

IMT is Portugal's property transfer tax, payable by the buyer on completion. The rate varies depending on property type, value and intended use:

• Urban property (primary residence): Progressive rates from 0% (under €97,064) to 7.5% (over €1 million). There is an exemption band structure.
• Urban property (holiday home or investment): Generally a flat rate starting at 1%, rising to 7.5% for values over €1 million
• Rustic/agricultural land: 5%

For most UK buyers purchasing a holiday home or investment property in the Algarve or Lisbon, expect to budget 5–6.5% of the purchase price for IMT. Your solicitor will calculate the exact amount.

Stamp Duty (Imposto de Selo)

0.8% of the purchase price on the property itself. If you're taking a Portuguese mortgage, there's additional stamp duty on the mortgage of 0.6%.

Notary and Land Registry Fees

Approximately €1,000–€2,500 depending on property value. These cover the official signing of the escritura and registration with the land registry (Conservatória do Registo Predial).

Solicitor's Fees

1–1.5% of purchase price, plus VAT at 23%. Budget a minimum of €2,000 for legal fees, rising to €5,000+ for complex transactions.

Summary: Total Purchase Costs

As a rough guide, budget an additional 7–10% of the purchase price for all taxes and costs combined on a typical residential property purchase. This is higher than the equivalent UK figure, which surprises many buyers.

Step 5: The Escritura (Final Deed)

The escritura is the formal, notarised deed of purchase that transfers legal ownership from vendor to buyer. It is signed at a Portuguese notary office in the presence of both parties (or their representatives), the notary, and usually both parties' solicitors.

IMT must be paid before the escritura is signed — your solicitor will manage this process, which involves paying at a bank and presenting proof of payment to the notary. The title deeds are then lodged with the land registry, and you are legally the owner of your Portuguese property.

Step 6: After Completion

Once you own your Portuguese property, several ongoing obligations apply:

IMI (Annual Property Tax)

The Portuguese equivalent of council tax. IMI (Imposto Municipal sobre Imóveis) is an annual property tax calculated on the property's taxable value (VPT — Valor Patrimonial Tributário), which is usually significantly below the market value. Typical IMI bills for a T2 apartment are €200–€600 per year. Villas in the Golden Triangle area can run to €1,500–€3,000.

Non-Resident Income Tax

If you rent your Portuguese property (whether short or long term), you must declare the rental income to the Portuguese tax authority (Autoridade Tributária) and pay Portuguese tax on it. The flat non-resident rate for rental income is currently 28%. You should also declare the income in the UK under the terms of the UK-Portugal double taxation treaty, but you will receive credit for Portuguese tax paid.

AIMI (Additional IMI)

Properties with a VPT over €600,000 (or €1.2 million for couples) are subject to an additional annual wealth tax on property. Most standard holiday home purchases are below this threshold.

Mortgages for UK Buyers in Portugal

Portuguese banks do lend to non-residents, though the terms are less favourable than for residents. Key points:

• Maximum LTV for non-residents is typically 70–80% (some banks limit to 60%)
• Proof of income, bank statements (usually 3–6 months), and tax returns from the UK required
• Portuguese banks include: Millennium BCP, Banco BPI (BNP Paribas group), Caixa Geral de Depósitos, Novo Banco, Santander Portugal
• Specialist mortgage brokers (in Portugal and the UK) who work with non-resident buyers can often secure better terms than going direct to a bank
• Fixed rates available for 2–10 years; variable rates based on Euribor (typically 3-month or 12-month)

After Buying: Your Next Step

Once you've completed on your Portuguese property, the next question is furnishing it. That's where we come in. Our complete Portugal furnishing guide covers everything from what to bring from the UK to realistic budgets, Portuguese furniture brands and the logistics of managing a furnishing project from abroad.

View our furniture packages for the Algarve, Lisbon, Porto and Silver Coast, or contact us for a no-obligation discussion about your project.