The first IMI payment period begins in May, so if you own a property, it is important to be aware of this annual tax.

To help you better understand how it works, we have put together a complete guide explaining the payment deadlines and how the Municipal Property Tax (IMI) is calculated.

Paying IMI: A Complete Guide

The Municipal Property Tax (IMI) is an annual tax levied on the taxable value of real estate in Portugal.

Understanding how IMI works, the associated tax obligations, and the relevant payment deadlines is essential to avoid penalties and legal issues.

This tax applies to the ownership of real estate, whether residential, commercial, or industrial.

Property owners are responsible for paying the tax, regardless of whether they are individuals or companies.

The amount due is calculated based on the property’s Taxable Asset Value (Valor Patrimonial Tributário – VPT), which is determined by the Portuguese Tax and Customs Authority (Autoridade Tributária e Aduaneira – AT).

 How is IMI calculated?

IMI is calculated by applying the tax rate set by each municipality to the property’s Taxable Asset Value (VPT).

Tax rates vary from one municipality to another, within the limits established by Portuguese law.

In general, properties used as a primary and permanent residence benefit from lower tax rates.

Properties intended for other purposes, such as rental or commercial activities, may be subject to higher rates.

To calculate the amount of IMI due, municipalities follow the limits established by the State.

Currently, the applicable rates are generally as follows:

• Urban properties: between 0.3% and 0.45% (which may reach 0.5% in certain circumstances); 
• Rural properties: up to 0.8%. 

A complete list of the IMI rates applicable in every Portuguese municipality is available through deste link, on the Portuguese Tax Authority’s online portal (Portal das Finanças).

Once you know your property’s VPT and the applicable municipal rate, the calculation is straightforward:

IMI = VPT × Municipal Tax Rate

When and How Should You Pay IMI?

Each year, the Portuguese Tax Authority issues an IMI tax assessment notice, which is sent to property owners.

This notice specifies the amount due and the relevant payment deadlines. For 2026, the payment schedule is as follows:

• Up to €100: payment is made in a single instalment in May; 
• More than €100 and up to €500: payment may be made in two instalments, due in May and November; 
• More than €500: payment may be made in three instalments, due in May, August, and November. 

IMI can be paid:

• Online through the Portal das Finanças; 
• In person at a Portuguese Tax Office or a CTT (Portuguese Post Office) branch; 
• At a Multibanco ATM; 
• Through a financial institution that has an agreement with the Portuguese Tax Authority. 

Who Qualifies for an IMI Exemption?

There are two types of IMI exemption: permanent and temporary.

The permanent exemption is available to households with low incomes, provided that the annual gross household income does not exceed 2,3 times the annual value of the Social Support Index (IAS) applicable in the relevant year.

To qualify, the following conditions must also be met:

• The property must be used as the taxpayer’s primary and permanent residence; 
• The property’s Taxable Asset Value (VPT) must not exceed 66,500 €. 

The temporary exemption is granted for three years and applies to taxpayers who purchase a property with a VPT of up to 125,000 €.

Where the legal requirements are met, IMI exemptions are generally granted automatically by the Portuguese Tax Authority based on the taxpayer’s annual income tax return.

What Happens If You Fail to Pay IMI?

Failure to pay IMI within the established deadlines results in the application of late-payment interest and may lead to tax enforcement proceedings initiated by the Portuguese Tax Authority.

In addition, outstanding IMI debts may prevent the property owner from completing transactions involving the property, such as a sale or donation.

For this reason, it is important to pay close attention to all notices issued by the Portuguese Tax Authority and ensure that your tax obligations are fulfilled on time to avoid unnecessary penalties and complications.