IMI Portugal 2025: what foreign residents and homeowners need to know

The Municipal Property Tax (IMI) is an annual tax charged by Portuguese councils on property owners, including foreign residents who own property in Portugal. This tax is based on the property’s taxable value (VPT) and applies to both rural and urban properties. The amount paid helps to fund local services and infrastructure across the country.

Beyond being a tax obligation, IMI is also a tool for local policy, allowing councils to adjust rates according to their economic and social objectives. This means the amount you pay can vary significantly depending on your municipality. But there’s more you should know about this tax before the 2025 deadlines.

How to calculate IMI?

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The IMI amount is calculated by multiplying the rate set by the local council by the property’s taxable value (VPT):

IMI = Rate × VPT

You can find this information in the Property Tax Certificate (Caderneta Predial), available on the Portuguese Tax Authority’s online portal (Portal das Finanças).

The VPT is determined based on various factors, including the property’s location, type, size, and condition. This means that similar properties may have different VPT values depending on the municipality and the property’s specific characteristics.

What are the IMI rates in 2025?

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For 2025, the IMI rates in Portugal are typically:

• Urban properties: between 0.3% and 0.45% (set by each municipality)
• Rural properties: 0.8% (fixed rate)

Some councils may apply reduced rates for properties used as a permanent residence or for families with dependants. Additionally, foreign residents who own property in Portugal should check their local council’s rate for the exact amount they will need to pay in 2025.

When is IMI due in 2025?

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IMI payments in Portugal are split into instalments depending on the total amount owed.

• If the IMI amount is up to €100, it must be paid in a single instalment by 30 June.
• For amounts between €100 and €500, the payment is made in two instalments:
  • The first by 30 June
  • The second by 1 September
• If the IMI amount is over €500, the payment is made in three instalments:
  • 30 June
  • 1 September
  • 2 December

However, property owners, including foreign residents in Portugal, may choose to pay the full IMI amount in the first instalment in June, regardless of the total amount due.

How can I pay IMI?

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If you have not received your payment notice, you can request a duplicate via the Portal das Finanças or visit your local tax office. When you have this, IMI can be paid in Portugal through various methods:

• At ATMs (Multibanco) using the payment reference provided on your payment notice
• Online via home banking using the same reference
• Directly at CTT (post offices) or bank branches
• Through the Portal das Finanças (the Portuguese Tax Authority’s online portal) or Tax Authority offices

It is essential to pay IMI within the specified deadlines to avoid interest charges and penalties. If you have any questions, you can always seek in-person or telephone support from the Portuguese Tax Authority.

What happens if you don’t pay IMI on time?

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If you miss the payment deadline, you will automatically be charged late payment interest, calculated based on the number of days the payment is overdue. Additionally, failure to pay can result in fines and the initiation of a tax enforcement procedure.

To avoid penalties, it is essential to keep track of the dates specified in your payment notices or follow the calendar published by the Portuguese Tax Authority. Non-payment of IMI can also lead to additional costs that may be difficult to resolve in the short term.

Who is eligible for IMI exemption?

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There is a temporary IMI exemption available for property owners who meet certain criteria. This exemption applies for three years (which can be extended up to five years) to properties used as a main residence, provided the property’s taxable value (VPT) does not exceed €125,000.

Additionally, the total household income must not exceed €153,300 per year. This measure aims to support families facing greater financial vulnerability, making it easier to access and maintain their homes.

What’s new with IMI in 2025?

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The Portuguese Tax Authority (Autoridade Tributária) has issued a clarification allowing taxpayers with payment deadlines originally set for the end of May to pay their IMI by 30 June 2025 without any penalties. This deadline extension was introduced to avoid confusion caused by delays in issuing tax assessments.

Another important update concerns landlords with rental contracts signed before 1990. If they have applied for IMI exemption, the Tax Authority will proceed with refunds of any overpaid amounts, reinforcing the enforcement of laws protecting these special cases.

Do owners of more than one property pay a different IMI?

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IMI is calculated individually for each property based on its taxable value (VPT) and the municipal rate where it is located. However, owners with multiple properties may be subject to the Additional IMI (AIMI), an extra tax levied on the total value of their property portfolio.

AIMI applies to individuals whose total property assets exceed €600,000 (excluding properties used for commercial, industrial, or service activities). This additional tax is charged separately and has its own specific rules, so it’s important to understand the distinction.

Can I challenge the IMI value?

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Yes, if you believe the taxable value (VPT) of your property does not reflect its true market value, you can request a revaluation from the Portuguese Tax Authority. This request is free of charge and can be made every three years, provided you have not made any alterations to the property that would affect its valuation.

You can submit your IMI revaluation request either in person at the local tax office or online through the Portal das Finanças. The online process involves:

• Logging into the portal
• Selecting the Municipal Property Tax (IMI) section
• Completing and submitting the Model 1 declaration with your property details and other information found on the Property Tax Certificate (Caderneta Predial)

Be sure to save your progress as you fill out the form and use the help options if you have any questions. After submission, the Tax Authority has up to 180 days to respond.

Do tenants pay IMI?

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While the answer is straightforward, many people still have doubts. In fact, IMI is the responsibility of the property owner. Tenants are not required to pay this tax unless there is a specific clause in the rental agreement stating otherwise — which is very rare and potentially illegal for permanent residences.

Even if the property is rented out, it is the landlord who must pay IMI every year. However, in some cases, the cost of IMI might be reflected in the rent, depending on the agreement reached between landlord and tenant.

Are there tax benefits in Portugal for families with children?

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Yes, there are IMI tax benefits for families with children through the so-called family IMI deduction. This measure allows fixed deductions on the tax amount depending on the number of dependants in the household.

The reductions are as follows:

• €30 for one child
• €70 for two children
• €140 for three or more children

These deductions apply only if the property is used as the main family residence and the children are declared as dependants on the household’s IRS tax return. The household composition is considered as of 31 December of the year prior to the IMI payment.

For the 2025 IMI, which covers the tax year 2024, 273 out of 308 municipalities in Portugal offer this deduction, including cities like Lisbon, Setúbal, Faro, Coimbra, and Évora. However, not all councils participate—municipalities such as Porto and Gaia do not apply this benefit.

To find out if you qualify, check the Portal das Finanças and verify whether your local council offers the family IMI deduction.