Portuguese Inheritance Tax 2026 — Imposto do Selo Guide

TL;DR — Five Key Numbers

• Spouse exemption: 100% — Portugal has no inheritance tax for spouses (Class 1).
• Children / parents exemption: 100% — Class 1 heirs are fully exempt regardless of estate value.
• Top rate (non-Class-1 heirs): 10% flat Imposto do Selo (stamp duty), plus 0.8% on Portuguese real estate.
• Lifetime / per-event limit: No threshold — the 10% rate applies to the entire taxable inheritance.
• Filing deadline: 3 months from death (longer for foreign estates; up to 6 months for assets located abroad).

Portugal abolished classical inheritance tax in 2004. What remains is Imposto do Selo (stamp duty) under verba 1.2 of the Tabela Geral, charged at 10% on free transfers to non-Class-1 beneficiaries. Class 1 heirs (spouse, descendants, ascendants) are fully exempt by article 6(e) of the Stamp Duty Code (Código do Imposto do Selo, CIS).

Legal Framework

The relevant statute is the Código do Imposto do Selo (CIS) — the Portuguese Stamp Duty Code — particularly verba 1.2 of the Tabela Geral (general schedule) which sets the 10% rate on inheritances and gifts, and article 6(e) which exempts Class 1 heirs. The classical Imposto sobre Sucessões e Doações was abolished by Decree-Law 287/2003 of 12 November 2003, in force from 1 January 2004.

The tax authority is the Autoridade Tributária e Aduaneira (AT), the Portuguese tax and customs authority. Portugal taxes the inheritance event (the transfer) rather than the heir directly — the heir is the taxable person, but the rate is a flat 10% regardless of the heir's individual circumstances within the non-exempt classes.

Residency anchoring: Imposto do Selo on inheritances applies to:

• Worldwide assets when the deceased was a Portuguese resident, AND
• Portuguese-situated assets when the deceased was a non-resident.

There is no equivalent to Germany's 10-year extended residency rule — Portugal stops applying immediately on loss of fiscal residency.

Heir Classes Table (2026)

Note the binary nature: Portuguese law makes no distinction between siblings, distant relatives and strangers — all pay the same flat 10%.

Allowances and Specific Reliefs

Class 1 exemption (article 6(e) CIS): the centrepiece of Portuguese inheritance taxation. Spouse, descendants and ascendants pay 0% regardless of estate value. This is the most generous direct-line treatment in the EU.

Pessoas em união de facto: unmarried cohabitants who can prove at least 2 years of continuous cohabitation under the Lei das Uniões de Facto (Law 7/2001) are treated equivalently to spouses for Class 1 exemption purposes. Documentation through the local junta de freguesia certificate is essential.

Real estate transfer: on inheritance of Portuguese real estate, an additional 0.8% stamp duty on the property's taxable value (VPT — Valor Patrimonial Tributário) applies on top of any 10% inheritance Imposto do Selo. Class 1 heirs pay only the 0.8% real estate stamp duty (the 10% is exempted).

Family business / shares: Portugal does not offer a specific business-succession relief comparable to Germany's BOR or France's Pacte Dutreil because the 10% flat rate (or 0% in Class 1) is already low. Inherited shares in unlisted Portuguese companies are valued at proportional equity value.

Life insurance: policies with named beneficiaries fall outside the inheritance and pay no Imposto do Selo, regardless of the beneficiary's relationship to the deceased — a planning lever for non-Class-1 transfers.

Pension survivor benefits: statutory and occupational survivor pensions are exempt from Imposto do Selo on inheritance.

Rates

Portugal uses a single flat rate — there is no progressive scale:

The 10% applies to the net value of the inheritance share after deduction of estate liabilities (proportional to the share).

Filing Process and Deadlines

The heir, executor or notary must file the inheritance with the Autoridade Tributária e Aduaneira by submitting a Modelo 1 do Imposto do Selo declaration within:

• 3 months from the date of death if death occurred in Portugal,
• Up to 6 months if assets are located abroad or the deceased died outside Portugal.

The declaration lists the deceased, the heirs, and an inventory of all assets and liabilities forming the inheritance. After review, the AT issues an assessment notice. Payment is due within 30 days of the assessment by ATM, multibanco or bank transfer using the assigned payment reference.

Late filing penalty (coima): ranges from €150 to €3,750 depending on the delay and complexity, plus interest.

Late payment interest: statutory rate (currently around 4% in 2026) accrues from the original payment deadline.

Payment plans: instalments of up to 3 years are routinely approved for non-Class-1 estates with limited liquidity, especially where Portuguese real estate is the principal asset. A bank guarantee or property mortgage may be required for instalments above certain thresholds.

Specific Reliefs

Article 6(e) Class 1 exemption: as above, covers spouse, descendants, ascendants and proven união de facto partners.

Charitable bequests: transfers to recognised non-profit and religious entities (IPSS, charities, museums) are exempt from Imposto do Selo under article 6(b) CIS.

Public-interest entities: inheritances to the Portuguese state, municipalities and public-interest foundations are exempt.

Real estate primary residence retention: there is no specific family-home exemption in Portugal — but with Class 1 heirs being exempt anyway, the only burden on a Class 1 heir inheriting the family home is the 0.8% real-estate stamp duty.

Gifts in last 3 years before death: Portugal does not have a clawback rule equivalent to the German 10-year window or the Belgian 3-year rule. Lifetime gifts (already taxed at the same 10% / 0% structure) are not pulled back into the estate. This makes lifetime gifting a clean Portuguese planning lever — particularly relevant for non-Class-1 transfers, where gifts to a sibling or partner are taxed once at 10% and not retaxed on death.

Life insurance planning: policies with named beneficiaries can route value to non-Class-1 persons (e.g., a long-term partner not meeting união de facto requirements) outside the inheritance, avoiding the 10% rate entirely.

Worked Example: €500,000 Estate to Spouse and Two Children

A Portuguese resident dies in 2026 leaving a net estate of €500,000: family home in Cascais (VPT €280,000, market value €380,000), Portuguese financial assets €100,000, foreign brokerage account €20,000. The will leaves everything equally to the surviving spouse and two adult children.

Spouse share (€166,667 total, including 1/3 of the home):

• All assets within Class 1 exemption → Imposto do Selo on inheritance: €0.
• On the spouse's 1/3 share of Portuguese real estate (VPT share = €93,333) → 0.8% × €93,333 = €747 real-estate stamp duty.

Each child share (€166,667 total, including 1/3 of the home):

• All assets within Class 1 exemption → Imposto do Selo on inheritance: €0.
• On each child's 1/3 share of Portuguese real estate (VPT share = €93,333) → 0.8% × €93,333 = €747 real-estate stamp duty.

Total Portuguese tax burden on this estate: approximately €2,241 — entirely composed of the 0.8% real-estate stamp duty on the Cascais home. No inheritance tax in the classical sense.

Now consider the same estate going to a sibling and two nephews instead:

• Sibling share €166,667 → 10% Imposto do Selo = €16,667.
• Each nephew share €166,667 → 10% Imposto do Selo = €16,667 (×2 = €33,333).
• Plus 0.8% × €280,000 (full VPT) = €2,240 real-estate stamp duty.
• Total ≈ €52,240 versus the Class 1 case's €2,241.

The 25× ratio between Class 1 and non-Class-1 outcomes is one of the starkest in the EU.

Cross-Border Angle

Deceased resident abroad with Portuguese assets. A non-resident dying with Portuguese-situated assets (typically a holiday home in the Algarve or Madeira) is subject to Imposto do Selo on those Portuguese assets only. The Class 1 exemption applies the same way — a spouse or child inheriting a Portuguese holiday home from a non-resident parent pays 0% inheritance Imposto do Selo plus 0.8% real-estate stamp duty on the VPT.

Portuguese resident with foreign assets. A Portuguese resident is taxed on worldwide assets. Class 1 heirs remain exempt. Non-Class-1 heirs pay 10% on the worldwide inheritance. Portugal allows unilateral foreign tax credit under domestic rules for inheritance tax actually paid abroad on foreign-situated assets, capped at the Portuguese tax that would have been due — generally not a binding constraint given the 10% flat rate.

Double-tax treaties on inheritance: Portugal has limited inheritance-tax treaty coverage; most coordination relies on unilateral relief in the AT's hands. The bulk of Portugal's tax treaty network covers income tax only.

Non-Habitual Resident (NHR) regime: historic NHR status (now in run-off after 2024 reforms) affects income tax, not inheritance. NHR did not provide additional inheritance benefits — Portugal's general 0% Class 1 / 10% other rule was already the favourable treatment NHRs sought.

Polish Reader Angle

A Polish heir of a Portuguese-resident deceased faces a clean two-step:

1. EU Regulation 650/2012 (Brussels IV) determines the succession law — Portuguese law by default (habitual residence), with the option to choose Polish nationality law in the will.
2. Tax is independent. Portuguese Imposto do Selo applies (0% Class 1, 10% other); Polish podatek od spadków i darowizn then applies to the Polish heir on the worldwide inheritance. Group 0 (spouse, descendants, ascendants, siblings) is exempt in Poland if SD-Z2 is filed within 6 months of acceptance.

For a Polish child of a Portuguese parent, both jurisdictions effectively impose €0 — Portugal under Class 1, Poland under Group 0. The only cost is the 0.8% Portuguese real-estate stamp duty on any Portuguese property.

For a Polish nephew of a Portuguese aunt, Portuguese tax is 10% of the gross share. Poland then applies Group III rates (7–20%) on the same inheritance. There is no Polish–Portuguese inheritance double-tax treaty, so unilateral relief is the only mechanism — Poland will generally credit the Portuguese tax against the Polish liability up to the lower of the two, often resulting in only a top-up Polish tax if Polish rates exceed 10%.

The practical sequence: file Modelo 1 in Portugal within 3 months; obtain assessment; file SD-Z2 (Group 0) or SD-3 (other) in Poland within 6 months of acceptance, attaching the Portuguese assessment as foreign tax evidence.

Estate & net worth planning sidebar: Polish families with Portuguese real estate (Algarve apartment, Lisbon studio bought as a holiday property) face an interesting cross-border footprint. Freenance's Financial Freedom Runway lets you model how inherited foreign property affects your timeline to financial independence, including ongoing IMI municipal tax on the Portuguese side and PIT implications when sold. Useful for deciding whether to retain, rent or sell inherited property.

FAQ

Did Portugal really abolish inheritance tax? Yes — classical Imposto sobre Sucessões e Doações was abolished by Decree-Law 287/2003 with effect from 1 January 2004. What remains is the 10% Imposto do Selo on inheritances to non-Class-1 heirs (verba 1.2 of the Tabela Geral, Código do Imposto do Selo).

Are stepchildren in Class 1? Only after formal adoption. A stepchild who has not been formally adopted is treated as a non-Class-1 heir for Imposto do Selo purposes and pays 10%. This catches blended families by surprise — formal adoption (even of an adult) addresses the issue if the social-family bond justifies it.

What about a long-term unmarried partner? Treated as Class 1 (exempt) only if the união de facto is formally recognised — typically requiring 2+ years of cohabitation evidenced by a junta de freguesia certificate. Without that, the partner falls into the 10% non-Class-1 bucket. Notarised cohabitation contracts and matching tax residency reinforce the union.

Do I pay anything as a Class 1 heir inheriting the family home? Yes — the 0.8% real-estate stamp duty on the VPT (Valor Patrimonial Tributário, the tax-assessed value) of the inherited property. This is typically modest because VPT is usually well below market value. No inheritance Imposto do Selo applies under article 6(e).

Are lifetime gifts a useful Portuguese planning tool? For non-Class-1 transfers, yes — gifts pay the same 10% Imposto do Selo once and are not pulled back into the estate on death. For Class 1 transfers, gifts are exempt the same way inheritances are, so timing matters mainly for control, not tax.

How does Portugal treat a Polish heir for inheritance Imposto do Selo purposes? Heir nationality does not affect the Portuguese rate. A Polish nephew of a Portuguese-resident aunt pays the same 10% as a Portuguese nephew. The interaction with Polish tax happens in Poland under PL inheritance tax rules, with unilateral relief for foreign tax paid.

Informational content, not legal/tax advice. Inheritance law is complex — consult a notary or tax advisor.

Practical Planning Considerations

Portuguese families and inbound expatriates face a deceptively simple landscape that nonetheless rewards careful planning. The Class 1 exemption does the heavy lifting — and for nuclear families with assets concentrated in spouse, children and parents, the only inheritance-side cost is the 0.8% real-estate stamp duty on Portuguese property.

The first planning theme is the união de facto question. Long-term unmarried partners need formal recognition (2+ years cohabitation, junta de freguesia certificate) to claim the Class 1 exemption. Cohabitants who never register risk falling into the 10% bucket on death, particularly when no will exists and intestate succession routes the estate via non-exempt collateral relatives.

The second is lifetime gifting for non-Class-1 transfers. Unlike Germany's 10-year rule or Belgium's 3-year clawback, Portugal does not pull lifetime gifts back into the estate. A 10% Imposto do Selo paid on a gift to a sibling in 2026 is final — that asset will not be retaxed on the donor's death. For non-Class-1 transfers, lifetime gifting effectively locks in the 10% rate and removes the asset from any future estate complications.

The third is the real estate IMT and IMI overlay. Inherited Portuguese property attracts the 0.8% inheritance stamp duty, plus ongoing IMI (Imposto Municipal sobre Imóveis) at 0.3-0.45% of VPT annually thereafter. The heir who retains an inherited Lisbon apartment as an investment property must budget for this recurring cost.

The fourth is the non-resident-deceased point. Holders of Algarve villas, Madeira apartments and Comporta beach houses often die abroad, leaving Portuguese real estate to non-resident heirs. The Portuguese position is clean: 0% inheritance tax + 0.8% real-estate stamp duty + 1% land-register fee. The home country (often the UK, Germany or the Netherlands) may impose its own inheritance tax on the same property, with unilateral relief depending on the bilateral treaty network.

The fifth — relevant for Polish heirs — is the timing alignment. Portuguese Modelo 1 is due within 3 months of death; Polish SD-Z2 is due within 6 months of acceptance. Filing Portuguese first and using the Portuguese assessment as evidence for the Polish filing is the typical sequence.

Sources

• Autoridade Tributária e Aduaneira (AT) — Imposto do Selo guidance
• Código do Imposto do Selo (CIS) and Tabela Geral (verba 1.2)
• Decree-Law 287/2003 — abolition of classical inheritance tax (in force 1 January 2004)
• Lei 7/2001 — Lei das Uniões de Facto
• Ordem dos Notários — succession practice handbook