Key figures — as of 2026-09-28: Full IRS/IRC exemption on rental income for contracts at or below 80% of a municipality's median rent per m² (INE data) — regime in force since 1 September 2026 under Decree-Law 97/2026 — minimum contract term 3 years for permanent housing (3 months for temporary) — separately, a 10% flat rate remains available for rents up to €2,300/month through 2029, with no median-rent condition.
The headline number
Zero. That's what a landlord now owes the Autoridade Tributária on rental income if they sign a qualifying contract under the new Regime Simplificado de Arrendamento Acessível (RSAA). The main added value of the RSAA is the total exemption from IRS and IRC on rental income derived from affordable rental contracts entered into under this scheme, a benefit written into the housing decree published in May. The scheme comes into force on 1 September 2026. For a market still defined by scarcity in Lisbon and Porto, that's the kind of number that could actually move supply — or at least that's the government's bet.
How the exemption actually works
The mechanics are narrower than the "tax-free landlord" headlines suggest. In accessible rental agreements, the monthly rent must be equal to or less than 80% of the municipality median, published by the INE. To claim it, landlords submit a copy of the contract and proof of communication on the Tax Portal to the IHRU by 15 January of the year following the contract's execution. Contract length matters too: the minimum contract term was reduced from five to three years for permanent residence, while temporary residence contracts need a minimum of three months, renewable.
It isn't the only option on the table. Landlords who don't want to drop below the median can instead take a reduced 10% flat tax rate on residential rental contracts with rents of up to €2,300 per month in 2026, although only until 31 December 2029. The RSAA, by contrast, gives the landlord a full exemption with no stated expiry date — a trade-off between a lower rent ceiling and a permanent tax break versus a higher rent ceiling and a temporary one.
GrowIN's number: sometimes the "discount" isn't a discount
Here's where it gets interesting for anyone comparing net income, not headline rent. Lisbon's median asking rent for new contracts sat at €17.42/m² in the first quarter of 2026, according to INE. Take an illustrative 70m² flat renting at that median: roughly €1,219/month, or €14,628 a year. Capped at 80% under the RSAA, that same flat rents for about €975/month — but pays zero tax. Taxed at the standard 25% autonomous rate on rental income instead, the full-market version nets the landlord only around €915/month after tax. Run the numbers and the "discounted" RSAA tenancy can leave the landlord with more net cash each month than charging full market rent and paying tax on it — a gap of roughly €60/month, or about 6.6%, in this example. That's GrowIN Portugal's own calculation based on published INE and Finanças rates, not an official government projection, but it illustrates why the scheme has real teeth for landlords sitting on empty units. Meanwhile, the tenant in that flat pays roughly €244 less a month than at market rate — a meaningful dent in a Lisbon budget.
What it means for foreign tenants
For foreigners priced out of central Lisbon and Porto — remote workers on a D8, retirees on a D7, or anyone just trying to find a flat without a bidding war — the RSAA doesn't create new housing, but it does change the incentive for owners of long-vacant units to put them on the formal market at a defined, sub-market rent. By reducing the tax burden on landlords and investors, the Government expects to increase the supply of affordable rental housing. Anyone hunting for a lease should ask directly whether a listing is under RSAA terms — a three-year minimum commitment cuts both ways, offering tenants unusual stability but also locking landlords (and tenants) in longer than a typical one-year Portuguese lease. See our tax & NIF hub for how rental income tax interacts with your own residency status.
What to watch next
The catch, as of late September: the new regime entered into force on 1 September but remains unregulated, which is essential for its application, and the IHRU's electronic platform where landlords and tenants can register for the RSAA is also not yet active. Without the missing portaria fixing exact rent ceilings by typology and municipality, landlords can't yet finalise eligible contracts with certainty. "A tax exemption that exists in law but not yet in practice is still just a promise to landlords," notes GrowIN Portugal Editorial. Anyone considering a lease under this scheme should confirm with Portal das Finanças and the IHRU that the operational rules are live before signing.