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When buying property in Portugal, one of the first decisions investors face is whether to purchase in their personal name or through a company.
While both options are legally valid, they come with different tax implications, costs, and long-term advantages. The right choice depends on your goals—whether you’re planning a personal move, a holiday home, or a strategic investment.
In this article, we’ll break down the key differences to help you make a smart and informed decision.
Is Buying Property in Portugal a Good Investment?
Buying property in Portugal continues to be a strong and attractive investment for several reasons — from safety and quality of life to growing property values and tourism potential.
Portugal is consistently ranked as one of the safest countries in the world, coming in 7th place globally according to the 2024 Global Peace Index. This stability not only attracts international buyers but also protects long-term real estate value.
Tourism is thriving in cities like Lisbon, which was recently awarded “Best City Break Destination” in Europe. This makes short-term rental properties in high-demand areas a particularly strong investment.
In Porto, there’s a noticeable trend of converting commercial buildings into residential real estate to boost rental returns, reflecting a robust and evolving property market (The Portugal News, 2024).
Healthcare is another key factor. Portugal offers universal healthcare through the SNS (Serviço Nacional de Saúde), making it not only a great place to invest—but also to live in (SNS Official Site).
Buying Property in Portugal Under Your Name
Buying property in your own name is often the go-to choice for individuals planning to live in Portugal, purchase a holiday home, or invest in a long-term rental.
It’s especially popular among expats and second-home buyers because the process is straightforward, with fewer legal and administrative requirements compared to purchasing through a company.
For those looking for simplicity and a direct path to residency or lifestyle benefits, personal ownership tends to be the most practical option.
Pros of Buying Property in Portugal Under Your Name
Simpler Process
Purchasing in your name involves less paperwork, fewer compliance requirements, and lower upfront costs in legal and accounting fees. For many buyers, especially first-time investors, this simplicity is a big plus.
Lower Annual Taxes
If the property is classified as your permanent residence, you may benefit from reduced IMI (Municipal Property Tax) rates or exemptions, depending on the municipality and value of the property.
Capital Gains Tax Benefits
When selling your primary residence, you can be partially or fully exempt from capital gains tax if you reinvest the proceeds into another main residence in Portugal or the EU.
Residency-Friendly
Buying in your personal name makes it easier to apply for residency permits like the D7, Digital Nomad Visa, or Golden Visa (when applicable). It demonstrates ties to Portugal and simplifies proof of accommodation.
Cons of Buying Property in Portugal Under Your Name
Ownership Transfer is Less Flexible
If you plan to pass the property on to heirs or sell it later, doing so in your personal name can be more cumbersome and potentially more expensive due to transfer taxes and bureaucracy.
Limited Tax Deductions
Unlike company ownership, individuals can’t deduct property-related expenses like renovations, repairs, or management fees from rental income, which may reduce profitability if you plan to rent it out.
Get In Touch With a Portugal Property Specialist
Portugal Residency Advisors® has assisted numerous international investors in successfully investing in Portugal. Discover how our trusted, all-in-one solution makes your investment journey smart and simple.
Buying Property in Portugal Through a Company
Buying property through a company—whether Portuguese or foreign—is often the preferred route for investors with long-term plans or those managing multiple properties.
It’s especially attractive for those running short-term rental businesses, real estate portfolios, or seeking tax efficiency through more structured ownership. While it does involve a more complex setup, it can offer several strategic advantages.
Pros of Buying Property in Portugal Through a Company
Tax-Deductible Expenses
One of the biggest advantages of company ownership is the ability to deduct property-related expenses. Costs such as maintenance, renovation, property management, utilities, and even some legal fees can be written off, reducing your taxable income—especially useful if you’re renting out the property.
Easier to Sell or Transfer
When a property is held by a company, ownership can be transferred by selling shares in the company rather than transferring the property title itself. This can be faster, more discreet, and potentially more tax-efficient, especially in inheritance or exit scenarios.
Ideal for Estate and Investment Planning
For international buyers, using a company structure—particularly a foreign holding company—can provide better control over estate planning and may help avoid or reduce inheritance taxes. It also allows for smoother succession planning across borders. Remember, finding and hiring a property manager can be a great way to ensure your investment is well taken care of.
Cons of Buying Property in Portugal Through a Company
Complex Setup and Ongoing Requirements
Creating a company, especially a foreign entity or a Portuguese Sociedade por Quotas (Lda), requires legal structuring, a tax representative, and ongoing compliance. You’ll need an accountant and will face annual filing obligations.
Higher Annual Costs
Beyond the setup, you’ll incur accounting fees, possible audit requirements, and corporate tax returns. These overheads can eat into your profits if you’re only holding one or two properties.
Tax Implications Can Vary
If not structured properly, owning property through a company can actually lead to higher taxation. For example, some foreign-owned companies may be taxed under Portugal’s “offshore list,” which can trigger higher property taxes (IMI) and stamp duty. Proper planning is essential to avoid this.
Why Choose To Work With Us
Local Expertise
We know Portugal. Due to our extensive local knowledge, we believe that concentrating our services in a single country destination is the best way to give you the most thorough and useful information.
Holistic Approach
We offer a streamlined communication channel for the entire process, delivering a comprehensive service that encompasses all facets of your real estate investment journey, including property search, negotiation, legal matters, due diligence, and property management.
Independent Service
As an independent buying agent, we have the flexibility to collaborate with any agent, seller, promoter, or developer, providing you access to all available options in the real estate market. This enables us to objectively analyze every opportunity and find the right property for you at the best price, free from complications.
Simple Process
Technology plays a significant role in our company, allowing us to provide you detailed property market information and minimize our clients’ involvement in paperwork. As customers ourselves, we understand how to best serve your needs.
Frequently Asked Questions
Is it legal for foreigners to buy property in Portugal in their own name?
Yes, absolutely. Portugal has no restrictions on foreign property ownership, and you can buy in your personal name without needing residency.
What are the tax differences between personal and company ownership?
Personal ownership may offer lower annual taxes (like IMI) and exemptions on capital gains for primary residences. Company ownership allows expense deductions but can face higher corporate tax rates if not structured properly.
Can I apply for a residency visa (like D7) if the property is owned by a company?
For most residency visas, especially the D7 or Digital Nomad Visa, personal ownership is more straightforward.
Is it more expensive to buy through a company?
Yes. You’ll face additional costs like company setup, accounting, annual compliance, and possibly higher tax rates, depending on the jurisdiction of the company.
Can I deduct property expenses from rental income in personal ownership?
Only limited deductions are allowed for individuals. In contrast, companies can deduct most property-related expenses, which can reduce taxable profits.
What’s better for inheritance planning—personal or company ownership?
Company ownership can offer more flexibility for estate planning, especially if you want to transfer shares rather than property title, which may avoid some local inheritance taxes.
Can I switch ownership from my name to a company later?
Yes, but it involves a formal property transfer, which means you’ll pay IMT (Property Transfer Tax), stamp duty, and notary fees again.
Is company ownership only for large investors?
Not necessarily. Even small investors might use a company if the property is part of a rental business or for tax structuring. However, it’s most beneficial when managing multiple properties.
Do I need a Portuguese company to buy through a company?
No, but it depends. You can use a foreign company, but be cautious: if it’s from a jurisdiction on Portugal’s tax haven list, you’ll face higher taxes.
Which option is better overall?
It depends on your goal. For personal use or relocation, buying in your name is usually easier and more tax-efficient. For serious investors or rental businesses, a company can offer long-term advantages—but with more complexity.
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