The new housing tax package approved by the Government aims, in broad terms, to respond to the housing and access-to-housing crisis currently affecting the country. There is an urgent need to increase the supply of homes on the market at prices that most people can afford, both to buy and to rent. Several measures are under discussion, but will there actually be real changes in consumers’ lives, particularly benefits for tenants and landlords? This week’s Deco Alerta article explains everything you need to know about the topic.
The Deco Alerta article is produced by Deco – the Portuguese Association for Consumer Protection – for idealista/news and is aimed at all consumers in Portugal.
I’ve heard about the new housing tax package, but in practical terms I’m not sure what will change for us as consumers. Can Deco clarify?
In a context marked by rising house prices, high rents and increased mortgage costs, the changes introduced by the housing tax package may create important opportunities, but they also require well‑considered financial decisions.
The new housing tax package introduces a set of measures designed to increase the supply of homes for purchase and rental by reducing taxes and creating tax incentives for families, landlords and investors.
The changes cover taxes such as IRS (personal income tax), IMT (property transfer tax), VAT and Stamp Duty, with the aim of easing some of the costs associated with buying, selling, renting and renovating property.
However, beyond understanding the expected benefits, it is important to consider how these measures may affect families’ financial protection and access to financially sustainable housing.
Benefits for tenants
One relevant change concerns rent deductions under IRS. Tenants can still deduct part of the rent they pay, but the maximum annual limit increases to €1,000 for residential rental contracts. To benefit from this deduction, it is essential to ensure that the rental contract is registered on the Tax Authority’s online portal (Portal das Finanças) and that rent receipts have been issued.
This measure may provide some relief for tenant households, particularly at a time when housing costs absorb a significant share of monthly income.
Note: since August 2025, tenants have been able to report rental contracts directly to the Tax and Customs Authority (Autoridade Tributária e Aduaneira – A) through the Portal das Finanças if landlords have not registered them within the legal deadline.
Selling a home and reinvesting without paying IRS on capital gains
Until now, anyone selling their main and permanent residence could benefit from an exemption from IRS on the capital gain, provided that the proceeds were reinvested in the purchase of a new main and permanent residence.
The rules have now been extended to allow an exemption from taxation on capital gains when the sale proceeds are reinvested in the purchase of properties intended for affordable or moderately priced rental housing, as long as the legally required conditions are met.
Buying a home: lower IMT costs
The tax package also provides benefits for those purchasing a main and permanent residence with controlled costs. In these cases, there may be an exemption from IMT on the first home purchase, as well as additional Stamp Duty benefits.
Given that the initial costs associated with buying a home in Portugal remain one of the biggest obstacles for many families, these measures may help reduce the financial effort required to move ahead with a purchase.
As mentioned at the outset, this tax package may create important opportunities for many families, but financial protection will continue to depend on the ability to make informed, sustainable decisions suited to each household’s circumstances.
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