Renting Out Your Property in Portugal: Insights from Local Experts

Happy Spring, friends! 💐 

Spring officially arrived with a bang—literally—bringing storms strong enough to tear off rooftops (our sympathies to the reader who lost their kitchen!). But at last, this Sunday morning, sunlight is pouring through my living room window, and I can’t help but feel a flicker of excitement for the warmer days ahead.

Big thanks to everyone who provided feedback on Pedro, the AI Estate Agent from last week’s newsletter. The single most reported and appreciated feature was his looks. I just hope you’re all equally impressed with his property savviness!

What you can expect to dig into today:

🔥 Spring is here (or we can pretend), and so is an epic Braai/BBQ deal—scroll down for the exclusive Spring special!

🏠️ Thinking about renting out your home while chasing warmer weather? Our Property Experts (yes, the same masterminds behind Pedro) have some invaluable advice.

🕑️ And finally: daylight savings is coming, meaning we’re about to lose an hour of sleep. We share some cool tips on how to survive the time shift.

Let’s dig in!

💟 

Enjoying The Expat Hustle? Show us some love! ⭐️✨ Drop a quick rating by clicking the link here—it helps us grow, reach more expats, and keep bringing you the good stuff. Thanks for being part of the Hustle family! 🚀

📷 Pic of the week

The Capela do Senhor de Padra (Chapel of the Lord of Stone), is located in Vila Nova de Gaia, Portugal, and was built on a rocky outcrop by the sea in 1763. This picturesque marbled beach of Miramar was once the place of pagan worship before being converted to Christianity, with the current chapel constructed to reclaim the land from its pagan roots. Despite this conversion, on nights when the moon is full, it is common to find melted candles left by neo-pagan worshippers on the rocks and in the sand next to the chapel.

📰 What’s Happening in Portugal this Spring

We’ve already highlighted some amazing events this month. Missed them? Check out last week’s newsletter for a roundup of this year’s major music events. Or go back another week where we covered some must-see events for March (like the Chocolate Festival in Óbidos running from March 21st to April 6th!)

Spring says it’s here, but let’s be honest, it’s still bluffing. So, let’s warm things up ourselves by looking at some events to get us moving this season.

🏊‍♂️ Triathlon 🚲️ 

Setúbal Triathlon, April 6, 2025

🚴 Cycle

EuroBEC Granfondo, April 6, 2025

Algarve Bike Challenge, April 11-13, 2025 (Tavira)

🏊️ Swim

Setúbal Open Water Race, April 12, 2025

🏃 Run

Lisbon Eco Marathon, April 13, 2025

Madeira Island Ultra Trail, April 26, 2025

🤸 SwimRun (Yes, it’s a thing)

Tróia Swimrun, April 13, 2025

Next weekend, we’re diving into April’s top events: culture, food, music, and more. Stay tuned! 🍷 

🏡 Lifestyle: Eat, Pray, Love—and everything in between

Spring Forward Without the Struggle: Hacks to Help You Adjust Ahead of The Clock Change on Sunday, 30 March 2025

According to the Sleep Foundation, Daylight Savings Time can really mess with your mind and body, especially in the first groggy weeks after the clock jumps forward. So in preparation for next week’s time shift, we’ve curated a list of practical and fun ways for you to handle the time change like a rockstar:

🪔 Try aromatherapy: Did you know that essential oils can help you stay grounded during the transition into Daylight Savings Time? Blends made with grounding oils can stabilize your energy, bringing calm and clarity as your routine shifts. Click here to learn more about our grounding blends and how to integrate them into your wellness journey.

🍄 Try mushroom coffee: Swap your regular coffee for mushroom coffee, which contains adaptogens that may help reduce stress and fatigue associated with the time change.

🎵 Create an energizing playlist: Curate a high-energy playlist to kickstart your mornings and combat the grogginess caused by the time shift

🕶️ Use light therapy glasses: Wear special light therapy glasses for 20-30 minutes after waking up to help reset your circadian rhythm more quickly.

🌍️ Practice "earthing": Spend time barefoot on grass or soil to help realign your body's electrical energy with the Earth's natural rhythms.

🧊 Cold water immersion: Take a quick cold shower or splash cold water on your face to shock your system awake and boost circulation.

☺️ Practice acupressure: Stimulate specific points on your face and body to promote alertness and reduce fatigue.

⏰ You’re now fully prepped to take on the time shift like a pro. May your alarms be merciful and your mornings be bright! ☀️

💰 The Hustle Fund — Money, Taxes, and All Things Financial

🏡 The Property Issue 🏡 

Today, we’re bringing you some property advice from the experts themselves—the very same team who brought you handsome Pedro (the AI Estate Agent) in last weekend’s newsletter.

This is the first of a three-part series where they’ll unpack (pun intended) everything you need to know about housing rentals in Portugal. Here’s a sneak peek at what’s coming up in the Property Insights series:

Part 1 of a 3-part series:

📌 March (today): Legal & Financial Guide to Renting Out Property in Portugal

📌 April: Practical Challenges & Pitfalls to Renting Property in Portugal

📌 May: How to Optimise to Achieve Better Rental Success in Portugal

Without further ado, I’ll hand things over to our collaborators for The Property Issue, FRESH Properties.

🏚️ 

Renting Property in Portugal: What You Need to Know

Renting out a property in Portugal can be a great source of income, but it comes with legal, financial, and tax considerations that many property owners aren’t fully aware of. With recent changes in rental laws and tax regulations, it’s more important than ever to stay informed. In this guide, we’ll help you understand the key differences between short-term and long-term rentals, what’s required to stay compliant, and how to make the most of your rental investment.

Short-Term vs. Long-Term Rentals: What’s Right for You?

Before renting out your property, you’ll need to decide whether to operate as a short-term rental (Alojamento Local - AL) or opt for a long-term lease. Each has its own set of rules and financial implications:

1. Short-Term Rentals (AL – Less than 30 days per stay)

   • Requires an Alojamento Local (AL) licence (not always available in certain areas like Lisbon, Porto, and parts of the Algarve due to restrictions).

   • Higher potential income, but subject to more regulations and stricter tax rules.

   • Must comply with safety measures, guest reporting requirements, and contribute to an affordable housing fund.

   • Taxed under Category B (business income), often with a 35% taxable base (the rest exempt) and a 28% flat tax for non-residents.

2. Long-Term Rentals (More than 30 days per stay)

   • More stable income and fewer regulations.

   • Subject to tenant protection laws, making eviction more difficult in certain cases.

   • Taxed under Category F (property income), with rates starting at 28% for non-residents. Longer leases can qualify for lower tax rates.

   • No AL licence required.

Choosing the right rental model depends on your goals. Short-term rentals can be lucrative, but they require more administrative work, while long-term rentals offer stability and lower compliance requirements.

Short-Term Rentals & AL Licensing: What’s Changed?

If you're considering an AL rental, be aware that new licence approvals have been suspended in high-demand areas. However, existing AL properties must still comply with stricter safety regulations, local tax contributions, and administrative updates.

How to Check if You Can Get an AL Licence:

• Visit your local Câmara Municipal’s website to check zoning restrictions

• Use SEF’s online system (if applicable in your region) to verify availability

• Contact the municipality directly for the most up-to-date information

Landlords must also register with the Registo Nacional do Alojamento Local (RNAL) and report guest stays to SEF (Serviço de Estrangeiros e Fronteiras).

Understanding Rental Taxes in Portugal

Taxes on rental income vary based on the rental type and your residency status:

1. Short-Term Rentals (AL Licences)

   • Taxed under Category B (business income)

   • Most landlords choose the Simplified Regime, where only 35% of income is taxable (the rest is exempt)

   • Non-residents pay a 28% flat rate, while residents are taxed progressively up to 48%

   • Some properties may also be subject to a municipal tourist tax (e.g., €2 per person per night in certain areas)

2. Long-Term Rentals

   • Taxed under Category F (property income)

   • Non-residents pay a flat 28% tax

   • Residents can opt for progressive tax rates (14.5% to 48%) or stick with the 28% flat rate

   • Tax incentives apply for longer lease agreements, with tax reductions for contracts over 2 years

If your short-term rental income exceeds €2,750 per year, you may also need to pay social security contributions. Keeping proper records and consulting with a tax expert can help you maximize deductions and stay compliant.

What About the NHR Tax Regime?

Portugal’s Non-Habitual Resident (NHR) tax regime offered tax benefits for foreign residents, but the program ended for new applicants in 2024. However, if you secured NHR status before 2024, your tax advantages remain for 10 years. For those who missed out, standard tax rates apply to rental income.

Need Help Navigating the Process?

Understanding Portugal’s rental landscape can be complex, but you don’t have to figure it all out alone. Whether you’re unsure about AL licensing, tax obligations, or choosing between short-term and long-term rentals, we’re here to help. Get in touch with FRESH Properties to speak with our team to help make your rental investment a success!

Stay tuned for our next newsletter, where we’ll explore the biggest challenges landlords face in Portugal and how to overcome them!

🏠️ 

With thanks to our collaborator, Stephanie Box, Real Estate Consultant at FRESH Properties, for her valuable insights and contributions to this article.

For more information on all things property, you can reach out to Stephanie via email below. Alternatively, WhatsApp the surprisingly helpful AI Estate Agent, Pedro, for real-time answers to your questions.

📧 Email: [email protected]

🗣 Lost in Lingo

Need to complain about the Spring weather? We’ve got you covered with some essential vocabulary in today’s video.

…And That’s All Folks

Thanks for reading! 💌

Hustle on!

Angelique🧞‍♀️

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