Declaring Portuguese rent in your home country without paying twice

Portugal taxes the rent from your Portuguese home first, because the property is there. Your country of residence usually wants to hear about the income too. It then avoids double taxation in one of two ways: it exempts the income (sometimes using it to set the rate on your other income), or it taxes it and subtracts a credit for the Portuguese tax. Which method applies depends on your country and its treaty with Portugal. The method decides whether you pay anything extra at home.

Who taxes first, and why

Nearly all tax treaties follow article 6 of the OECD Model Convention: income from immovable property "may be taxed" in the country where the property is. Portugal therefore taxes your rent whether you live in Lisbon or Leeds. Non-residents declare it on the annual IRS return (Modelo 3, Anexo F), filed between 1 April and 30 June of the following year.

Your residence country taxes you on your worldwide income. Its treaty with Portugal, or its own law where there is no treaty, then says how it removes the overlap:

• Exemption method. The residence country does not tax the Portuguese rent. Under "exemption with progression" it still counts the rent when it sets the tax rate on your other income.
• Credit method. The residence country taxes the rent under its own rules, then deducts the Portuguese tax. The credit is capped at the home-country tax on that same income. If Portugal's tax is higher, the difference is not refunded. If it is lower, you pay the difference at home.

Two points apply everywhere:

• A credit covers only Portuguese income tax (IRS). It does not cover IMI (municipal property tax) or AIMI. In some countries those are deductible expenses instead.
• Your home country works out the rental profit under its own rules, using its own deductible expenses, depreciation and exchange rates. The figure on your Portuguese return will often differ from the one on your home return.

Overview by country

The sections below explain each country. The rules are complex, so treat this as orientation and confirm your own case with a local adviser.

Netherlands

• Who taxes first: Portugal.
• Method: The Netherlands does not tax the actual rent in income tax. The property is an asset in Box 3 (savings and investments), declared at its market value (waarde in het economisch verkeer) on 1 January. There is no Dutch WOZ value for a foreign home, so you need to support the value with an appraisal or comparable sales. Under the treaty the Netherlands then gives a vermindering ter voorkoming van dubbele belasting (reduction to prevent double taxation). This applies the exemption method as a proportional reduction of your Box 3 tax.
• Where: Box 3 of your aangifte inkomstenbelasting: the foreign property, then the double-tax reduction for assets abroad.
• Practical tip: Advisers point out that the standard calculation can give too little relief when you have debts or a tax-free allowance. In June 2024 and July 2025 the Hoge Raad (Dutch Supreme Court) ruled that, under the actual-return (tegenbewijs) route, foreign real estate must in effect be fully exempt. Box 3 is also being reformed. If your Portuguese home is a large share of your Box 3 assets, check with a Dutch tax adviser whether to file an objection or use the actual-return route.

Belgium

• Who taxes first: Portugal.
• Method: Exemption with progression. Belgium does not tax the Portuguese income, but takes it into account when setting the rate on your other income.
• Where: Frame III of the personal income tax return, using the foreign-property codes, with the treaty-exempt income claimed for exemption with progression. Since income year 2021, Belgium gives foreign property a cadastral income (revenu cadastral / kadastraal inkomen) and treats it like Belgian property. A home let to a private individual who does not use it for business is normally taxed on the indexed cadastral income plus 40%, not on the actual rent. Let to a company or for business use, the actual rent counts.
• Practical tip: You must first declare the property to the General Administration of Patrimonial Documentation (AAPD) so that it can set the cadastral income. The deadline is four months after you buy it, and 30 days after a change such as starting to let it. Late or missing declarations can bring a fine of €250 to €3,000. Check with a Belgian adviser which codes apply in your year's return.

France

• Who taxes first: Portugal.
• Method: Exemption with progression (taux effectif). Article 24(1)(a)–(b) of the 1971 France–Portugal convention says French income tax does not apply to income that Portugal may tax, but France may use it to set your tax rate. This is not the "credit equal to French tax" method that some websites describe: the official 2047 notice lists Portugal among the exemption countries.
• Where: The 2047 notice says exempt property income kept for the effective rate goes directly on form 2042 C: line 4EA (régime réel) or 4EB (micro-foncier). It does not go on form 2047.
• Practical tip: Declare any Portuguese bank account that receives the rent on form 3916. Ask a French adviser whether French social contributions (prélèvements sociaux) can apply to your Portuguese rent, because the treaty covers income tax only.

Germany

• Who taxes first: Portugal.
• Method: Under the Germany–Portugal treaty, Germany exempts rental income from Portuguese property. For most foreign income an exemption still raises the rate on other income (Progressionsvorbehalt). But § 32b(1), second sentence, no. 3 EStG switches that off for rental income from property in another EU or EEA state. Portuguese rent therefore neither is taxed in Germany nor raises your German rate.
• Where: Because the income has no German tax effect, it generally does not need to go on Anlage V or Anlage AUS. Losses from the Portuguese property are equally of no use in Germany.
• Practical tip: Keep the Portuguese assessment (nota de liquidação) and lease in case your Finanzamt asks. If you hold the property through a company or also have other foreign income, check with a Steuerberater.

United Kingdom

• Who taxes first: Portugal.
• Method: Credit. Under the 1968 UK–Portugal convention, Portuguese tax is allowed as a credit against UK tax on the same income. A new UK–Portugal convention was signed on 15 September 2025, but GOV.UK lists it as not yet in force. Until it takes effect, the 1968 treaty applies.
• Where: The SA106 "Foreign" pages of your Self Assessment return. Under "Income from land and property abroad", use boxes 14 to 24 for rent, expenses and adjusted profit, and the columns for each country to claim Foreign Tax Credit Relief (FTCR). HMRC's helpsheet HS263 explains the calculation.
• Practical tip: UK rules apply in full, including the restriction on mortgage interest (finance costs) for residential property and the £1,000 property income allowance. The UK tax year runs from 6 April to 5 April, while Portugal's runs with the calendar year, so you need to apportion both rent and Portuguese tax. Convert at the exchange rate when the income arose. Relief is capped at the UK tax on the Portuguese profit: a basic-rate taxpayer may pay nothing extra, and a higher-rate taxpayer will usually pay a top-up.

Ireland

• Who taxes first: Portugal.
• Method: Credit under the Ireland–Portugal treaty. Revenue explains that where a treaty applies you work out the Irish tax on the foreign rental income and then deduct the foreign tax paid. The deduction is capped at the Irish tax on that income.
• Where: Foreign rental income is taxed under Schedule D Case III. On Form 11 you enter the number of foreign properties, gross rent, expenses, interest, capital allowances and net profit in the foreign rental section, and claim the foreign tax credit.
• Practical tip: Losses on a foreign property can only be carried forward against future profits from foreign property, not against Irish rent or other income. Revenue also notes that a tax on deemed rental income cannot be credited. Ask an Irish adviser how USC and PRSI interact with the credit in your case.

United States

• Who taxes first: Portugal. The United States taxes its citizens and residents on worldwide income wherever they live.
• Method: Credit. Article 25 of the 1994 US–Portugal convention allows Portuguese income tax as a credit against US tax, subject to US law.
• Where: Report the rent and expenses on Schedule E (Form 1040), with the foreign address. Claim the credit for Portuguese IRS on Form 1116, usually in the passive category. IMI is a property tax, not an income tax: it goes on Schedule E as an expense and cannot be claimed on Form 1116.
• Practical tip: Residential rental property used outside the US must be depreciated under the Alternative Depreciation System. IRS Publication 527 sets the period at 30 years for property placed in service after 2017, and 40 years before that. Portuguese tax often exceeds the US tax on the net rent after depreciation, and unused credits can be carried back one year and forward ten. Separately, if your Portuguese bank accounts together exceed $10,000 at any time in the year, file an FBAR (FinCEN Form 114). It is due on 15 April, with an automatic extension to 15 October. The house itself is not reported on the FBAR.

Sweden

• Who taxes first: Portugal.
• Method: Credit under Swedish domestic law. Sweden terminated its tax treaty with Portugal with effect from 1 January 2022, so there is no treaty. Skatteverket allows a credit (avräkning) for the final tax you paid abroad, up to the Swedish tax on that income.
• Where: If the home counts as a private dwelling (privatbostad), any surplus after the standard deduction is capital income, entered in box 7.3 of Inkomstdeklaration 1 and taxed at 30%. For a house or owner-occupied flat, the standard deduction is SEK 40,000 a year plus 20% of the rent. Request the credit under "Övriga upplysningar" (Other information) in the return.
• Practical tip: The flat-rate deductions often leave a small Swedish surplus, which the Portuguese credit can wipe out. You cannot carry excess Portuguese tax into a refund, so keep the Portuguese assessment as proof of the final tax.

Brazil

• Who taxes first: Portugal.
• Method: Credit. Under article 23 of the Brazil–Portugal convention (Decreto 4.012/2001), Brazil deducts the Portuguese tax. The deduction is capped at the Brazilian tax on the same income.
• Where: Rent received from abroad by a Brazilian resident falls under the carnê-leão. It is calculated monthly at the progressive rates and paid by the last working day of the following month. It then goes into the annual return (DIRPF), with the property listed under Bens e Direitos. The 15% annual regime of Lei 14.754/2023 is for aplicações financeiras and controlled entities abroad. It excludes rent, so it does not cover a home you own directly.
• Practical tip: If you hold the property through a Portuguese or other foreign company, different rules apply. Ask a contador how to record Portuguese tax paid in the carnê-leão and which exchange rate to use.

Checklist

1. File the Portuguese return first (Modelo 3, Anexo F, 1 April – 30 June) and keep the assessment showing the final tax.
2. Find your country's method (exemption or credit) and the matching form, using the overview table.
3. Recalculate the rental profit under your home country's rules and exchange rates.
4. Claim relief only for Portuguese income tax, never for IMI or AIMI.
5. Meet any separate reporting duties: the Belgian AAPD property declaration, the French 3916 bank-account form, the US FBAR.
6. If treaty details are unclear or your situation is unusual (a company, joint owners, moving country mid-year), check with a tax adviser in your country of residence.