The new housing tax package has already been published in Diário da República and promises to significantly change the fiscal and contractual framework of the sector in Portugal. The diploma, approved by the government, creates three distinct regimes: investment contracts for rental, partial refund of VAT on construction and new affordable rent, but not all measures produce immediate effects.
According to , this is Decree-Law No. 97/2026, published on May 20, which implements the legislative authorization granted by Law No. 9-A/2026 and introduces changes to several tax codes, including IRS, VAT, IMT and the Tax Benefits Statute. According to the same source, the objective is to increase the supply of housing through incentives aimed at investors, owners and individuals.
Investment contracts become more demanding
One of the main new features is the regime for investment contracts for housing rentals. The law provides tax incentives that can be in force for up to 25 years, but also establishes relevant penalties in case of non-compliance.
The description of the regime points to the total loss of tax benefits when the contract is terminated, accompanied by refunds that vary depending on the moment of non-compliance. The sooner the conditions are breached, the greater the amount to be returned, in a progressive system that penalizes the first years of validity.
Regularization deadlines are short and non-compliance can lead to coercive collection, with the application of compensatory interest, covered by the General Tax Law.
Transmission subject to authorization and control
The possibility of transferring the contractual position also becomes strongly conditioned. The operation depends on compliance with cumulative requirements, prior communication to the IHRU and government approval, upon proposal from that body.
Furthermore, the authorization is subject to land registration and is subject to specific expiry and monitoring rules, reinforcing administrative control over these contracts.
Another of the most far-reaching measures concerns the creation of a partial VAT refund scheme for the construction of permanent housing.
Instead of a direct reduction in the invoice, the envisaged model involves an initial payment at the standard rate, with a subsequent partial refund. As technical analyzes of the diploma explain, the refund corresponds to the difference between the normal rate and the reduced rate, with the request being submitted to the Federal Revenue within a defined period after completion of the work.
The mechanism appears as a way to reduce the effective cost of construction, although with formal and temporal requirements that require planning on the part of individuals.
The diploma also introduces the simplified affordable rental regime, which reformulates the existing model and establishes new criteria.
Furthermore, the main limit is now defined by reference to the median income per municipality, with the ceiling set at 80% of this value. This rule aims to encourage the placing of properties on the market at lower prices, in exchange for associated tax benefits.
At the same time, the Government intends to simplify procedures and increase adherence to the regime, in an attempt to respond to the shortage of housing supply at prices considered moderate.
Although already published, the new framework does not come into operation in a uniform way. According to the same source, different measures have their own application dates, which means that some rules will only take effect in the coming months.
As a whole, the package combines tax incentives with more demanding obligations and control mechanisms, in a balance that aims to stimulate investment without giving up oversight.
Also read:
