Key figures — as of 2026-08-01: Full IMT + Stamp Duty exemption for under-35 first-home buyers now covers properties up to €330,539 (up from €324,058 in 2025) — a 2% annual adjustment; partial exemption applies between €330,539 and €660,982, with an 8% marginal rate on the excess; above €660,982, no exemption applies; eligibility requires being 35 or under at the deed date and buying a first permanent home not owned (directly or indirectly) in the prior three years.
A bigger tax-free ceiling for young buyers
Portugal's "IMT Jovem" regime just got a little more generous. As of 2026, the tax on a first acquisition of a permanent residence by people up to age 35 is only payable if the value on which it's levied exceeds €330,539, up from €324,058 previously. That single number matters more than it sounds: it's the ceiling below which a young buyer pays zero Imposto Municipal sobre Transmissões (IMT) and zero stamp duty on the deed — two costs that otherwise eat into the first years of homeownership.
The uplift isn't a one-off political gesture — it's baked into the mechanics of the tax code. Portugal's 2026 State Budget maintains the exemption and applies a 2% update to the bracket limits, mirroring the same inflation-style adjustment applied to all IMT brackets. The maximum value of this bracket rises from €324,058 to €330,539 in 2026, keeping pace with the general climb in property values rather than eroding in real terms as prices increase.
How the exemption actually works
The scheme isn't a blanket discount — it's tiered. Total exemption applies to properties up to €330,539, while partial exemption covers the band between €330,539 and €660,982, where only the 8% marginal tax rate applies on the amount exceeding €330,539. Properties over €660,982 don't qualify at all. The relief isn't limited to IMT either — young buyers also get an exemption from Stamp Duty up to the same €330,539 threshold, worth 0.8% of the purchase price, with Stamp Duty payable on the remainder for higher-value properties.
Eligibility is narrow but workable for many foreign residents settling in Portugal long-term. Buyers must be up to 35 years old at the time of the deed and must not own — or have owned in the previous three years — another primary residence. The property has to be the buyer's genuine first permanent home, not an investment purchase or land for future construction — the acquisition of building land for a first home is specifically excluded from the benefit, according to a binding ruling from the Autoridade Tributária. Foreigners who moved to Portugal on a D7, D8 or work-based residence permit and are buying their first Portuguese property can claim it on the same terms as Portuguese nationals, provided they meet the age and ownership-history tests.
Couples where only one partner qualifies aren't shut out entirely. When a property is bought by two people and only one is 35 or under and meets all requirements, the exemption isn't lost — it applies to that buyer's ownership share, producing a proportional partial exemption.
GrowIN's take: what the 2% rise is actually worth
Run the numbers and the "2%" headline translates into something concrete. The threshold moved up by €6,481 (€330,539 minus €324,058). On that specific slice of extra purchasing power, a buyer would previously have faced Portugal's combined 8.8% marginal rate on transfer tax and stamp duty had they exceeded the old cap. That means the adjustment effectively shields roughly €570 in tax that would otherwise have applied to buyers purchasing right at the new ceiling instead of the old one — not a fortune, but real money at closing, and it compounds with every future annual update as Portuguese property prices keep climbing.
"An annual 2% adjustment sounds bureaucratic, but for a buyer closing right at the new ceiling it's roughly €570 back in their pocket at the notary," says GrowIN Portugal Editorial.
What foreign buyers should watch
The exemption must be requested before the deed, not after — the IMT exemption request has to be made before the purchase and deed of the property, typically via Modelo 1 do IMT on the Portal das Finanças. Values are assessed against whichever is higher: the deed price or the Valor Patrimonial Tributário (VPT). Buyers should also remember the six-year rule attached to any HPP-rate purchase: the obligation to keep the property as a permanent residence for six years already applied to all buyers taxed under the primary-residence brackets, with recalculation at the higher second-home rate if that condition is breached.
For non-resident buyers still working through the wider cost picture — IMT, stamp duty, IMI and legal fees — our /property/ guide breaks down the full purchase process step by step, and our services team can confirm eligibility before you sign a promissory contract. As always with Portuguese tax exemptions, confirm the figures with Finanças or a licensed adviser before you commit — brackets update every year, and getting the classification wrong at the deed is expensive to fix afterward.
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