Property Sales Process | Selling Costs

Overview:

In Portugal, the buyer is liable to pay for all of the purchase, including notary fees, Land Registry fees, and transfer taxes. The vendor is liable for all costs in connection with the property up to the completion date. In the instance of any dispute, the law and courts which govern the contrato de promesso will deal with it.

Selling Costs:

The two main selling costs that vendors will have to pay are:

• Estate agent's fees

• Capital gains

  – (IREH) Any capital gain (mais-valia) arising is taxable as income.
• For residents this is on a sliding scale from 12-40%. However, for residents the taxable gain is reduced by 50%. Proven costs that have increased the value during the last five years can be deducted.
• For non-residents, the capital gain is taxed at a uniform rate of 25%.
• The capital gain which arises on the sale of own homes or residences, which are the elected main residence of the taxpayer or his family, is tax free if the total profit on sale is reinvested in the acquisition of another home, own residence or building plot in Portugal.

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