General country information
Portugal, bordered to the north and east by Spain and to the west and south by the Atlantic Ocean, is a full member of the EU. The country is mountainous north of the Tagus River, with plains to the south. Offshore its territories include Madeira, and the Azores.
Summers are hot and dry, winters are relatively wet with most rain falling in November and December.
Portugal has a diversified and increasingly service based economy which is now substantially privatised.
Current projections for the Portuguese economy point to a contraction of economic activity of 2.3 per cent in 2013 (-3.2 per cent in 2012). This contraction refl ects a sharp decline in domestic demand, against a background of lower permanent income prospects. Exports are expected to decelerate in 2013, although maintaining a positive growth, despite the deteriorating outlook for external demand.
The year will be marked by very low inflationary pressures, both internal and external, which will translate into a consumer price growth slightly below 1 per cent. Economic activity is thus projected to grow by 1.1 per cent in 2014. Similarly to 2013, inflationary pressures are expected to remain low and the inflation rate to stand at low levels.
Portugal has a land registry system that records ownership of property and any encumbrances or charges.
As in Italy, property transactions usually entail a preliminary (promissory) contract stage at which the buyer pays a deposit. Completion has to be formalised before a notary. The notary will have checked that the documentation is in order and will provide a copy of the entry in his official books as proof of purchase.
It is at this stage that settlement of the purchase price, legal fees and transfer taxes will be required. Transfer taxes are based on the value of the property and have a starting threshold of about £56,000. Thereafter they range from 2 per cent to 8 per cent of value, the higher figure applying to properties valued in excess of about £350,000.
Estate agents fees are usually paid by the seller but this means estate agents, who are state licensed, work on behalf od the seller rather than the buyer.
It used to be that buying property through a company brought capital gains tax and inheritance tax benefits, but these rules are being changed and in some instances buying through offshore companies will in future be detrimental to investors’ tax positions.
Income tax is also be levied on properties owned by non-Portuguese based on the value of the property whether or not it is rented out.
Country information – Portugal
Area: 92,345 sq km
Principal cities: Lisbon
Median age of population: total: 37.9 years
male: 35.8 years
female: 40 years
Employment rate: 83.1%
Flying time from UK: Lisbon 2.13hrs
Currency: 1 Euro = 100 Cents
Time difference from UK: +1
Rate of inflation: 3.08%
International dialling code: +351
GDP per person: $22,330
Climate: Maritime temperate; cool and rainy in north, warmer and drier in south