The Simplified Affordable Rental Scheme (Regime Simplificado de Arrendamento Acessível — RSAA) entered into force on 1 September 2026, granting a full exemption from Personal Income Tax (IRS) or Corporate Income Tax (IRC) on rental income earned by landlords who meet the legal requirements.
The scheme is intended to encourage landlords to make housing available at prices below prevailing market rates. The caps per municipality and property type are now set out in Ministerial Order (Portaria) No. 454/2026/1, in force since 14 October 2026, with effects back to 1 September.
Legal Framework
The RSAA was enacted under the legislative authorisation granted by Law No. 9-A/2026, of 6 March, and implemented by Decree-Law No. 97/2026, of 20 May (as subsequently adjusted).
Which Leases Qualify
The RSAA applies only to residential leases, including leases for residential sub-letting and residential sub-leases. Leases for non-residential purposes are outside its scope.
The scheme is available to any entities, public or private — individual landlords, companies, cooperatives and collective investment undertakings — regardless of the number of properties they own. Minimum lease terms apply:
- Three years for permanent residential accommodation;
- Three months for temporary accommodation. In this case, the tenant must have their tax residence in a municipality other than the one in which the property is located.
Main Changes
- The previous 35% rent-to-income ratio requirement has been abolished.
- The maximum rent is now determined solely by the municipality and the property type, based on 80% of the median rent per m² published by Statistics Portugal (Instituto Nacional de Estatística — INE).
- The specific caps are set out in Ministerial Order No. 454/2026/1, of 13 October, which revoked Ministerial Orders No. 175/2019, 176/2019 and 177/2019.
Rent Caps
By way of example, the maximum monthly rents are as follows:
- Lisbon: T1 (one-bedroom) up to €1,006; T2 (two-bedroom) up to €1,309; T3 (three-bedroom) up to €1,612
- Cascais: T1 up to €964; T2 up to €1,254; T3 up to €1,544
- Porto: T1 up to €866; T2 up to €1,118; T3 up to €1,341
These limits may be increased by 10% if the property has private parking and by a further 10% if it holds an energy performance certificate rated A or higher. Both increases may be applied cumulatively. For leases of parts of a dwelling (rooms), an additional 25% increase applies where the room has a private bathroom.
The caps may be revised by a new ministerial order or, in years without a revision, automatically updated on 1 January in line with the annual coefficient set out in Article 24 of the New Urban Lease Regime (Novo Regime do Arrendamento Urbano — NRAU).
How to Apply
Applications must be submitted to the Institute for Housing and Urban Rehabilitation (Instituto da Habitação e da Reabilitação Urbana — IHRU), which makes available on an electronic platform the caps in force and a tool for calculating the increases. Following the signing of the lease, the contract must be submitted by 15 January of the following year, together with a copy of the agreement and proof that it has been reported through the Portuguese Tax Authority’s online portal (Portal das Finanças).
What About Pre-Existing Leases?
Leases entered into under the previous Rental Support Programme (Programa de Apoio ao Arrendamento, Decree-Law No. 68/2019, of 22 May) remain in force and are automatically treated as leases under the RSAA, preserving the tax effects previously conferred by that regime and by municipal affordable-rental programmes.
Landlords with “ordinary” leases entered into before 1 September 2026 may also access the RSAA, provided that (i) the rent complies with the caps for the municipality and property type, (ii) the term meets the three-year minimum (or three months for temporary accommodation) and (iii) the application is submitted to the IHRU and the reporting obligations are complied with. In practice, this will usually require either a formal renegotiation of the lease or a new lease that meets these conditions.
Municipal Programmes
The law also allows for the approval of municipal affordable-rental programmes within the RSAA framework. Leases under such programmes qualify equally for the tax exemption, provided they meet the scheme’s conditions.
Rents Outside the RSAA
Rental income that does not qualify under the RSAA is not necessarily subject to the standard tax rates. Under Article 45-C of the Tax Benefits Statute (Estatuto dos Benefícios Fiscais, as added by Decree-Law No. 97/2026, of 20 May), rental income from strictly residential leases with a monthly rent not exceeding the caps set out in Article 2(2)-(3) of that decree-law is subject to a flat 10% autonomous tax rate until 31 December 2029. For IRC taxpayers — or IRS Category B taxpayers with organised accounting — only 50% of such income is taken into account.
This publication is part of a series on the housing-rental incentives framework. See also our previous articles on the new tax measures to boost rental supply and construction and on the reduction of IRS to 10% for moderate rents until 2029.
How VCA Can Help
These rules concern individual landlords, companies and investors with residential property in Portugal. We follow the rental incentives framework closely and can assess, case by case, whether a new or existing lease can benefit from the exemption and which tax treatment fits best.
Tax Department
João Valadas Coriel | Sofia Quental | Inês Grácio | Catarina Amaral
