In Portugal, young people planning to buy their first home next year could continue to benefit from significant tax savings, with the Government proposing to maintain existing exemptions on property transfer tax and Stamp Duty.

As reported by Postal, the proposed State Budget for 2027 (OE2027) retains the tax benefits for eligible buyers aged 35 or under, while adjusting the property value thresholds to reflect a 2.4 percent increase in the relevant brackets.

The changes would raise the maximum property price eligible for full exemption from Property Transfer Tax (IMT) from €330,539 to approximately €338,141.

Higher thresholds

Buyers purchasing a property above the full exemption limit would not automatically lose all their tax benefits.

Under the proposed changes, the next threshold would increase from €660,982 to €676,185.

In accordance with the applicable rules, properties valued between the two limits would remain eligible for partial relief, with buyers paying tax on the portion of the purchase price that falls outside the fully exempt bracket.

Purchases exceeding €676,185 would no longer qualify for the IMT Jovem benefits under this regime.

The adjustments could give young buyers more flexibility, particularly in areas where property prices make it harder to find a home within the existing exemption limits.

Stamp Duty exemption

The proposed budget also maintains the Stamp Duty exemption for eligible young people buying their first permanent residence.

Buyers must be aged 35 or younger at the time of acquisition and meet other legal requirements to qualify, including purchasing the property exclusively for their own permanent housing, with the exemptions subject to the conditions and limits established under the IMT Jovem regime.

The tax relief aims to reduce the upfront costs of buying a first home, which can otherwise be a significant financial barrier for younger households.

Purchase benefits

According to the report accompanying the budget proposal, nearly 120,000 young buyers have already benefited from the measures, with the average purchase price around €200,000.

In addition to tax exemptions, the Government also intends to maintain the public guarantee scheme for mortgage lending and strengthen the Porta 65 programme, which provides support for young people renting a home.

These initiatives form part of broader efforts to improve access to housing for younger generations, both in the property market and in the rental sector.

Final approval

Despite the proposed increases, the new thresholds are not yet definitive.

The measures are in the draft State Budget for 2027 and must still pass parliamentary approval before becoming law.

For prospective buyers planning to purchase next year, the proposal would raise the ceiling for full IMT exemption, while continuing Stamp Duty relief for those who meet the eligibility criteria.

The final rules and thresholds will depend on the outcome of the budget process.

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