Property
Local lodging for newbies With the holiday season extended due to the excellent weather and the relaxing of restrictions, the property rental market has been good. If you're thinking about renting out your property, there are tax implications to be aware of. By Robert Bijker, Happy Homes Algarve PROPERTY MANAGEMENT ALGARVEAN COTTAGES
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Happy Homes Algarve is currently looking for additional good quality rental Villas and Apartments to offer to our customers for next season. If you have a property to let, please contact us for more details'
Confused about the new rental law? Contact us for specialist advice. C o n t a c t us t o d a y : 2 81 32 0 28 3
h a p p y h o m e s l d a. R u a D r. P a r r e i r a 1 3 7 next to Barclays Bank 8 8 0 0 - 3 46 T a v i r a
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Covering the whole of the Algarve as independant real estate agents, we can provide you with unbiased advice when you decide to purchase a property and can introduce you to a wide choice of reputable mortgage banks, architects, lawyers, builders, chartered surveyors and interior designers. We have been in business for over 16 years, finding the right property for countless satisfied clients. We currently have over 900 properties available online and would be very pleased to help you find your ideal home.
If you are the owner of a good quality property and wish to sell, please contact us to arr ange an appoin tment TA VI RA
R u a J o sé P i r es P a d i n ha 1 7 8 880 0 - 3 5 4 T av i r a
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hose who visited the Algarve in September and October this year were pleasantly surprised by the more than exceptional good weather that they encountered. Simply Algarve promotion at its best! Most places were pleasantly busy during this period as people took advantage of the possibility to travel again. This in turn was also good for local businesses in general. The property market also remains active and prices were 7.6% higher in Q3-2021 versus a year ago, according to data from Imovirtual. It may well be that you are in the process of searching for a property to buy, or have just bought one. Like most second home-owners you will want some rental income from your property to cover costs, or in the case of an investment, you would want to maximise your return. Short term holiday rentals are governed by the Alojamento Local laws. As one of the oldest property management companies in the greater Tavira area, Happy Homes have assisted hundreds of clients getting up and running in a cost efficient manner. Happy Homes can obtain the rental license (licença de Alojamento Local) on your behalf and open the rental activity in compliance with the law. You can file your rental income under the simplified regime, which means that you are only taxed on 35% of your income. The remaining 65% is exempt. Under the simplified regime there are no individual deductible items allowed, however, you do benefit from the 65 percent exemption from income tax. Non-residents pay a flat rate of 25% over the 35% that is taxable. Residents add the rental income to their other income which is taxed at a progressive rate. The 1st year you benefit from a further 50% reduction in tax, which in the 2nd year drops to 25%. Only in the third year you will pay tax over the full 35%. This is effectively 8.75% of your total rental income, which makes it easier to remember. If your rental income is above Euro 27.000, you will need to prove that you had 15% or more expenses. If you cannot prove this with invoices, your effective tax rate goes up. Furthermore, you are automatically exempt from VAT for the first year of your rental activity.
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