Portugal’s 2027 budget: what it could mean for your income tax and rent
The Government’s 2027 State Budget proposal is before Parliament. Here are the main measures for families, from income tax to rent deductions.
The Portuguese Government has delivered its 2027 State Budget proposal (OE2027) to Parliament, where it is now being debated. These measures are still proposals and may change before the final vote.
Income tax (IRS)
- Updated tax brackets: the bracket thresholds rise by 3.88%. For example, the ceiling of the first bracket goes from €8,342 to €8,666.
- Lower rates: rates in the first six brackets fall by between 0.3 and 0.5 percentage points. The first bracket drops from 12.5% to 12.2%.
- Minimum existence: rises to €13,580, which means people earning up to about €970 gross a month would pay no IRS.
- IRS Jovem: the tax benefit for people up to 35 continues.
Housing
- Tenants: the IRS deduction for rent would rise to €1,000.
- Landlords: a reduced 10% tax rate for landlords who charge moderate rents.
- Buying a home: IMT brackets rise by 2.3%, and young people up to 35 can keep the IMT and Stamp Duty exemption on their first permanent home, if they meet the requirements.
Pensioners
The Complemento Solidário para Idosos, a supplement for low-income older people, would rise from €670 to €720.
What it means for you
If you are planning to become tax resident in Portugal, these changes may affect your future tax bill and housing costs. We will share the final measures once the budget is approved.
Sources: OE2027 official website; ECO. This article is general information, not tax advice.
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