If you've sold property, shares, or other assets in Portugal and realized a profit, you'll need to understand how to file your capital gains tax return in Portugal. Whether you're a Portuguese resident, an expat living in Lisbon, or a non-resident who sold a holiday home in the Algarve, the Portuguese tax system requires you to report capital gains through the annual IRS (Imposto sobre o Rendimento das Pessoas Singulares) return. This Portugal tax filing guide breaks down every step of the process for the 2025/2026 tax year so you can meet your obligations accurately and on time.
Capital gains in Portugal fall under Category G of the IRS and can involve the sale of real estate, shares, bonds, intellectual property, and other assets. The rules differ depending on your residency status, the type of asset, and whether you qualify for any exemptions. Let's walk through everything you need to know.
Understanding Capital Gains Tax in Portugal
Before you begin the filing process, it's essential to understand what qualifies as a capital gain (mais-valias) in Portugal and how the tax is calculated.
What Counts as a Capital Gain?
A capital gain arises when you sell an asset for more than you paid for it. In Portugal, taxable capital gains commonly include:
- Real estate — Selling residential, commercial, or land property
- Shares and securities — Disposing of stocks, bonds, and investment fund units
- Intellectual property — Selling patents, trademarks, or copyrights
- Business assets — Disposing of assets used in a commercial activity
- Cryptocurrency — Selling digital assets held for less than 365 days (gains on crypto held for over one year are generally exempt for individuals)
How Is the Gain Calculated?
For real estate, the taxable gain is calculated as:
Capital Gain = Sale Price − (Acquisition Cost × Inflation Coefficient) − Allowable Expenses
Allowable expenses can include:
- Costs of improvements made in the last 12 years
- Real estate agent commissions
- Legal and notary fees
- Energy certification costs
- IMT (property transfer tax) paid on acquisition
The inflation coefficient (coeficiente de desvalorização da moeda) is published annually by the Portuguese government through a Portaria and adjusts the original purchase price for inflation, reducing your taxable gain.
For shares and other securities, the calculation is simpler:
Capital Gain = Sale Price − Acquisition Cost − Transaction Costs
Use our Portugal Capital Gains Tax Calculator to estimate your liability before you file.
Capital Gains Tax Rates for 2025/2026
The rates that apply to your capital gains depend on your tax residency status and the type of asset you sold.
Rates for Tax Residents
| Asset Type | Tax Treatment |
|---|---|
| Real estate | 50% of the net gain is added to your other income and taxed at progressive IRS rates (14.5%–48%, plus a solidarity surcharge of up to 5% on very high incomes) |
| Shares & securities | Flat rate of 28%, or optionally included in your global income (englobamento) and taxed at progressive rates |
| Cryptocurrency (held < 365 days) | Flat rate of 28%, or optional englobamento |
| Cryptocurrency (held ≥ 365 days) | Exempt |
The option to include investment gains in your global income (englobamento) can be advantageous if your marginal tax rate is below 28%. However, be aware that once you opt for englobamento, it applies to all Category E and Category G income for that tax year.
Rates for Non-Residents
| Asset Type | Tax Treatment |
|---|---|
| Real estate | 28% flat rate on the full gain (not just 50%), unless the taxpayer is an EU/EEA resident and opts for the resident regime |
| Shares in Portuguese companies | 28% flat rate |
| Shares in non-Portuguese companies | Generally not taxable in Portugal |
Important for EU/EEA non-residents: If you are a tax resident of another EU or EEA member state, you can elect to be taxed under the same conditions as Portuguese residents. This means only 50% of a real estate gain would be subject to tax at progressive rates, which can result in a significantly lower tax bill. This option was confirmed and clarified by Portuguese courts and the tax authority (AT) in recent years.
Practical Example
Suppose you are a Portuguese resident who purchased an apartment in Lisbon in 2015 for €200,000 and sold it in 2025 for €350,000. You spent €20,000 on renovations and €15,000 on agent and legal fees.
- Adjusted acquisition cost: €200,000 × 1.15 (hypothetical inflation coefficient) = €230,000
- Allowable deductions: €20,000 + €15,000 = €35,000
- Net capital gain: €350,000 − €230,000 − €35,000 = €85,000
- Taxable amount (resident): 50% of €85,000 = €42,500 added to your other income
If your other employment income is €30,000, your total taxable income would be €72,500, taxed at the applicable progressive rates. Use our Portugal Income Tax Calculator to see the full impact on your tax bill.
Key Exemptions and Rollover Relief
Portugal offers several important exemptions from capital gains tax. Understanding these could save you thousands of euros.
Primary Residence Exemption (Reinvestment Relief)
If you sell your primary residence (habitação própria e permanente), you may be fully or partially exempt from capital gains tax if you reinvest the sale proceeds in another primary residence within:
- 36 months after the sale, or
- 24 months before the sale
The reinvestment can be in Portugal or in another EU/EEA member state. Key conditions include:
- The property sold must have been your primary residence
- The new property must also become your primary residence within 12 months of purchase or completion of works
- If you only reinvest part of the proceeds, the exemption is proportional
Example: If you sell your primary residence for €300,000 (gain of €80,000) and reinvest the full €300,000 in a new primary residence, the entire gain is exempt. If you reinvest only €200,000, then approximately two-thirds of the gain would be exempt.
Exemption for Taxpayers Over 65
If you are 65 years of age or older at the time of the sale and sell your primary residence, you can benefit from an exemption by reinvesting the sale proceeds into:
- An eligible life insurance contract
- A pension fund or a retirement savings plan (PPR)
- Contributions to the public capitalization regime
The reinvestment must occur within 6 months from the date of sale.
Properties Acquired Before 1989
Gains from the sale of properties acquired before January 1, 1989 are generally exempt from capital gains tax, as the capital gains tax on real estate was introduced on that date.
Step-by-Step: How to File Your Capital Gains Tax Return in Portugal
Here is the detailed process for filing your capital gains via the annual IRS return.
Step 1: Gather Your Documentation
Before you start, collect the following:
- Deed of sale (escritura de compra e venda) for the sold property, or brokerage statements for securities
- Deed of acquisition (original purchase document)
- Receipts for improvements and allowable expenses (invoices with your NIF)
- NIF (tax identification number) for all parties
- Portal das Finanças login credentials
- Bank statements or brokerage records showing transaction costs
- Proof of reinvestment, if claiming the primary residence exemption
Step 2: Access the Portal das Finanças
- Go to Portal das Finanças
- Log in using your NIF and password (or Chave Móvel Digital / digital mobile key)
- Navigate to "Cidadãos" → "Entregar" → "IRS"
- Select the relevant tax year
Step 3: Choose the Correct Annexes
The IRS return is modular — you only fill in the annexes (anexos) that apply to your income categories.
For capital gains, you will need:
- Anexo G — For capital gains on assets acquired after January 1, 1989 (real estate) or taxable securities
- Anexo G1 — For reporting gains on assets acquired before January 1, 1989 (exempt but must still be declared)
- Anexo J — For foreign-source capital gains (e.g., you sold property or shares abroad while being a Portuguese tax resident)
You will also need Anexo A (employment income) or other relevant annexes for your complete tax return.
Step 4: Fill In Anexo G (Capital Gains)
Within Anexo G:
- Quadro 4 (Table 4): Report the details of real estate sales — the date of acquisition and sale, the purchase and sale prices, and allowable expenses
- Quadro 9 (Table 9): Report gains from shares, securities, and other financial assets
- Quadro 5 (Table 5): Declare your intention to reinvest if claiming the primary residence exemption, including the reinvestment amount and timeline
Tip: The Portal das Finanças may pre-populate some fields if the notary reported the transaction. Always verify the pre-filled data against your actual documents.
Step 5: Opt for Englobamento (If Beneficial)
If you had gains from shares or securities taxed at the flat 28% rate, check whether opting for englobamento (inclusion in your global income at progressive rates) would reduce your overall tax. This is typically beneficial if your total taxable income places you in a marginal tax bracket below 28%.
Warning: Choosing englobamento applies to all Category E (investment income) and Category G (capital gains) income. You cannot cherry-pick which gains to include.
Step 6: Review and Submit
- Review all entries carefully
- Run the built-in validation to check for errors
- Submit the return electronically
- Save or print the confirmation receipt (comprovativo de entrega)
Step 7: Pay Any Tax Due
After submission, the AT will process your return and issue a tax assessment (nota de liquidação). If tax is due:
- Payment is typically due by August 31 of the year following the tax year
- Payment can be made via ATM (Multibanco), direct debit, or bank transfer
- If the amount exceeds certain thresholds, installment payments may be available
Filing Deadlines for 2025/2026
The IRS return filing period for income earned in 2025 is:
| Deadline | Details |
|---|---|
| April 1 – June 30, 2026 | Filing period for all categories of income (the unified deadline applies since 2023) |
| August 31, 2026 | Typical deadline for payment of any tax due |
Late filing penalties: Filing after the deadline can result in fines ranging from €150 to €3,750, depending on how late the return is and whether you were notified by the AT. Interest on unpaid tax also accrues.
Double Taxation Agreements and International Considerations
Portugal has an extensive network of double taxation agreements (DTAs) with over 80 countries, including the United States, United Kingdom, France, Germany, Brazil, and Canada.
How DTAs Affect Capital Gains
- Real estate: Most DTAs allow the country where the property is located to tax the gain. If Portugal is where the property sits, Portugal has the primary taxing right. Your country of residence should then provide relief (either a tax credit or exemption) to avoid double taxation.
- Shares: Under most Portuguese DTAs, gains from the sale of shares are taxable only in the seller's country of residence, unless the shares derive more than 50% of their value from real estate in the other country.
Non-Habitual Resident (NHR) Regime — Legacy Considerations
The NHR regime was officially closed to new applicants as of January 1, 2024, replaced by the new IFICI (Incentivo Fiscal à Investigação Científica e Inovação) regime. However, individuals who were already approved under NHR continue to benefit from it for the remainder of their 10-year period.
Under NHR:
- Foreign-source capital gains from shares may be exempt in Portugal if taxable in the source country under a DTA
- Portuguese-source capital gains remain subject to standard Portuguese rules
For the new IFICI regime (applicable from 2024), different rules apply, and capital gains treatment is more restrictive. Consult a tax professional if you transitioned or are considering this regime.
Common Mistakes to Avoid When Filing
Filing capital gains in Portugal can be complex. Here are the most frequent errors taxpayers make:
Failing to declare exempt gains: Even if your gain is exempt (e.g., property acquired before 1989 or full reinvestment in a primary residence), you must still declare the transaction in your IRS return. Non-declaration can trigger audits and penalties.
Forgetting the inflation coefficient: Many taxpayers use the raw purchase price without applying the coeficiente de desvalorização monetária, overstating their taxable gain.
Missing the reinvestment deadline: If you declared your intention to reinvest but fail to do so within 36 months, the AT will reassess your return and charge the full tax plus interest.
Not reporting foreign gains: Portuguese tax residents are taxed on their worldwide income. Gains from selling property or shares abroad must be reported in Anexo J.
Incorrect annexes: Using Anexo G instead of Anexo G1 (or vice versa) for pre-1989 properties is a common data entry error.
Overlooking allowable deductions: Renovation costs, agent fees, notary fees, and IMT paid at acquisition all reduce your taxable gain. Keep invoices with your NIF.
Non-residents failing to appoint a fiscal representative: Non-residents from non-EU/EEA countries are generally required to appoint a fiscal representative (representante fiscal) in Portugal. Failing to do so can complicate your filing and lead to penalties.
Frequently Asked Questions
Do I need to file a tax return if I sold property at a loss?
Yes. You must declare the sale even if you made a loss. Reporting a loss can also be beneficial — real estate losses can offset gains from other real estate sales in the same year and can be carried forward for 5 years under certain conditions. However, losses on shares cannot offset real estate gains and vice versa.
Can non-residents file the IRS return online?
Yes. Non-residents with a Portuguese NIF and Portal das Finanças credentials can file online. If you don't have portal access, you can register remotely or through your fiscal representative.
Is withholding tax applied on real estate sales?
When a non-resident sells property in Portugal, the buyer is not generally required to withhold tax on the sale price. However, the non-resident seller must file a tax return and pay the applicable capital gains tax.
What happens if I don't file?
The AT can assess penalties for non-filing, including fines and interest. Additionally, the notary reports all property sales to the tax authority, so the AT will be aware of the transaction regardless of whether you file.
How do I estimate my tax before filing?
Use our Portugal Capital Gains Tax Calculator to get an estimate based on your specific sale details, or our Portugal Income Tax Calculator to understand how the gain affects your overall tax position.
Conclusion and Key Takeaways
Filing your capital gains tax return in Portugal requires careful attention to detail, but the process is manageable when you follow the right steps. Here's a quick summary:
- Deadline: File your IRS return between April 1 and June 30, 2026 for gains realized in 2025
- Annexes: Use Anexo G for taxable gains, Anexo G1 for exempt pre-1989 gains, and Anexo J for foreign gains
- Residents benefit from the 50% inclusion rule on real estate gains and the option to choose englobamento for securities
- Non-residents pay a flat 28% on real estate gains (with an EU/EEA election available)
- Always declare — even exempt gains and losses must be reported
- Reinvestment relief can eliminate the tax on primary residence sales if done within 36 months
- Keep all invoices and documentation — the AT can audit returns for up to 4 years
For a quick estimate of your potential tax liability, try our Portugal Capital Gains Tax Calculator before you file.
This article is for informational purposes only and does not constitute tax advice. Tax laws change frequently; consult a qualified tax professional for advice specific to your situation.