Portugal's State Budget proposal for 2023 (OE2023) foresees several changes in terms of tax benefits, namely regarding rental. According to the document, those who transfer their permanent residence to an inland countryside territory and rent a home will be able to benefit from a tax deduction of 1,000 euros per year for three years.
The limit of 502 euros provided for in the IRS income tax code "applicable to the deduction of rental costs, is raised to 1,000 euros over 3 years, the first of which is the year in which the contract is signed, in the case of costs resulting from the transfer of the permanent residence to a landlocked area", according to the government proposal.
In order to be entitled to this tax benefit in Portugal, it will be necessary to indicate on the Finance Portal "the invoices or other document that are related to the lease that results in the transfer of the permanent residence to an interior territory".
Other tax incentives for the Portuguese countryside
Increase in education and training expenses
Also in terms of IRS income tax in Portugal, the State Budget proposal for 2023 provides for an increase of 10 percentage points in the value of education and training expenses of students attending educational establishments located in the inland regions of the country, increasing the overall limit to 1,000 euros, when the difference is related to these expenses.
Tax incentives for renting in Portugal
Companies operating inland territories in Portugal will now also be able to benefit from a "net job creation" regime, under which the expenses incurred with the hiring of residents in these territories will be considered at 120% of the respective amount for purposes of determining taxable profit. The wage costs in question include both the fixed remuneration of the employee and the Social Security contributions borne by the same entity.
Where is the highest demand for rental homes in Portugal? Lisbon and Porto outside the top 50
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The 25 cheapest municipalities to rent a home in Portugal in 2025
A quick look at the rental map of Portugal reveals clear differences in prices across the country in the second quarter of 2025. The cost of renting a home ranges from a high of €22.2 per square metre (€/m²) in Lisbon to a low of €6.8/m² in Castelo Branco. Using data from idealista, Portugal’s leading property marketplace, we reveal the 25 cheapest places to rent a home in the country.
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