Are you thinking about converting your property into a short-term rental? Portugal is ideal for short-term rentals, from luxury apartments with panoramic views to charming vacation rentals. With its historic charm, popular attractions, and easy access to other Schengen areas, Portugal’s cities and locations make it a fascinating destination for travelers.

Whether you’re considering renting apartments in bustling cities or looking to provide student accommodation in a fantastic location, you can tap into a market that generates year-round income.

In this guide, we’ll walk you through all the essentials for setting up your short-term rental in Portugal, including registration and obtaining your short-term rental license (Licença de Alojamento Local). This article will also include key information about rentals in Portugal to help you get started, including:

How to Acquire a Short-term Rental Portugal License

Owning homes or apartments for rent in Portugal is a prime opportunity to earn extra income. If you’re considering entering the short-term rental Portugal market, there are key steps to follow to ensure you comply with local regulations.

First, you must obtain a license to operate as an Alojamento Local (AL). This license is crucial for legally listing your property as a short-term rental on popular sites like Airbnb and Booking.com. The Local Lodging Regime (Alojamento Local Regime), established in 2014, governs short-term rentals.

You’ll also need to register your property as tourist accommodation with your local town hall (Câmara). This registration is vital for meeting the legal requirements and making the most of the short-term rental market. By following these guidelines, you’ll be well-positioned to offer homes or apartments for rent in Lisbon and capitalize on the demand for rentals in Portugal.

How to register

tax documents, a phone, and coffee on a tableTo officially register for your short-term rental Portugal licence, you need to:

  • Open an activity on the Portuguese Tax and Customs Authority portal and register a new activity with CAE 55201 or 55204.
  • Register a local accommodation number by going to the RNAL website and submitting documents such as the property’s land register, your Citizen Card, and proof of opening activity with the Portuguese Tax and Customs Authority.
  • After registering your Alojamento Local, you must meet the inspection requirements within 30 days. The local Municipal Council will carry out this inspection.

Your property should have a fire extinguisher, fire blanket, first aid kit, a house instruction booklet in four languages, and an acrylic identification plate marked “AL.” Additionally, you need to provide information about the availability of a complaints book.

Following on from registering, you need to ensure that you:

  • Issue invoicing receipts for all the bookings you receive through the Portuguese Tax and Customs Authority (Finanças) portal, sending them to guests within five days.
  • Submit mandatory data to AIMA, such as your guest’s name, ID card number, nationality, and travel information.
  • Collect Tourist Taxes and pay them to your local City Council.

To get into short-term rentals in Portugal, you must register your properties as Alojamento Local (AL). This applies to various types of properties, including houses and apartment rentals. An AL provides temporary accommodation in exchange for a set price. Ensure your short-term rental complies with all registration requirements to offer a smooth rental experience.

To simplify registering your Airbnb listing in Portugal, follow these steps:

  • Go to “Your Listings” on airbnb.com.
  • Select your listing in Portugal.
  • Click the “Registration” button at the top of the page.
  • Follow the instructions to complete the registration.
  • Click “Submit” to finalize the process.

If you have multiple listings in Portugal, you need to follow the same registration process for each one. If you’ve registered, simply complete the steps to add your existing permit number to your listing. There’s no need to renew your registration unless there are changes to your listing or registration details.

If any updates occur, notify the relevant Portuguese authorities within ten days and update your property listing on Airbnb. Remember, the registration process is free of charge.

Required documents

documents, a pen, and a pot plant on a deskTo comply with Portuguese regulations, you need to provide the following documents or information to the authorities:

  • The name, address, and NIF (Portuguese tax number) of the owner or person who will carry out the activity
  • The activity start date
  • The property capacity (the number of beds, rooms, and guests)
  • A valid authorization of the use of the property
  • Emergency contact details
  • Your residency’s name and address
  • Your passport, ID, and company documents
  • The land registry document
  • A signed declaration that states that your real estate is a suitable AL establishment
  • Lease agreement, deeds, or other documents that entitle you to rent your property
  • Declaration of Tax Activity (Declaração de Início de Atividade) CAE 55201 or 552014

What are short-term rental containment zones?

Lisbon City Council introduced shortterm rental containment zones in 2019, limiting the areas where AL licenses can be granted. This was in response to problems such as an oversaturation of AL properties in certain regions.

For example, in Lisbon, new AL properties are banned in 19 neighborhoods and eight parishes, with the historic downtown area enforcing a complete prohibition on new short-term rental establishments. Additionally, certain areas in Lisbon, like Alfama, Bairro Alto, Baixa, Graça, and Mouraria, cannot receive any more AL registrations.

What are the differences between short-term, monthly, and long-term rentals?

When considering renting out your property, it’s essential to understand the different options available in Portugal. Here’s a quick guide to help you make an informed decision:

AL properties

AL (Alojamento Local) properties are ideal for short-term rentals and must be fully furnished. Located near historical sites, popular attractions, or within a short distance of public transport, these rentals in Portugal offer easy access to local amenities, ensuring an enjoyable stay. Other types of properties, including luxury apartments, can also be considered, but furnished rentals are particularly sought after for their convenience and comfort.

Long-term rentals

If you’re considering long-term renting in Portugal, these can be apartments for rent that don’t necessarily need to be fully furnished. Long-term rentals in Portugal have specific legislation and require a detailed rental contract. Previous tenants may leave behind furniture or appliances. Ensuring easy access and a short distance to essential amenities for long stays or other rentals can help tenants live comfortably.

Monthly rentals

Monthly rentals, including serviced apartments for rent, are generally furnished rentals with a fully equipped kitchen. They might also offer wi fi, free parking, and sometimes even a private pool or private garden. Monthly rentals can be a practical option if you are in an area affected by AL suspension zones.

Leasing your property as a monthly rental does not require an AL permit. However, while monthly rentals may be more straightforward to set up and attract digital nomads or people relocating for work, they might not be as profitable as short-term rentals. Make sure to have a well-drafted rental contract to cover all details.

For those interested in operating a short-term rental in Portugal, understanding these distinctions will help you optimize your property’s potential and navigate the regulations effectively. This can make your property an ideal place for vacationers and long-term guests alike.

Touristic Enterprises for Short-Term Rental Portugal

people walking in a street in PortugalYour Portugal short-term rental might be classified as a touristic enterprise. Examples of such enterprises include:

  • Portugal Hotels, including bed and breakfasts, guesthouses, and inns
  • Holiday villages
  • Resorts
  • Touristic apartments 
  • Caravan sites and campsites
  • Tourism enterprises in rural areas

Touristic enterprises are governed by a specific legal regime called the Regime Jurídico da Instalação, Exploração e Funcionamento dos Empreendimentos Turísticos.This regime applies to establishments that provide accommodation services in exchange for remuneration.

Providing the right facilities and equipment is essential to ensure your short-term rental in Portugal is operational and meets all guidelines. This includes offering modern appliances and an on-site fully equipped kitchen.

Consider adding room service or other complementary services to enhance the guest experience. These features help promote an enjoyable stay and allow guests to live comfortably on your property.

What are the best locations for short-term rentals Portugal?

When looking for the best short-term rentals in Portugal, consider these five popular destinations, which offer a range of vacation rentals, including luxury apartments and charming properties.

Lisbon

As Portugal’s vibrant capital, Lisbon is a prime location for short-term rentals. Due to saturation, popular destinations within the city, like Alfama, Bairro Alto, Baixa, Graça, and Mouraria, are currently restricted from new AL (Alojamento Local) licenses. However, there are still plenty of options for vacation rentals in other neighborhoods. For property owners, Lisbon offers a bustling market with a high demand for rental properties, leading to substantial rental income potential.

Porto

Porto is another top choice for short-term rentals in Portugal. Known for its scenic riverfront and historic architecture, Porto attracts visitors who seek both culture and relaxation. Whether you’re offering luxury apartments or cozy vacation rentals, Porto’s appeal as a popular destination ensures strong rental demand and potentially higher returns for property owners.

Algarve

The Algarve region, renowned for its stunning beaches and sunny weather, is a hotspot for vacation rentals. Property owners in the Algarve can benefit from a steady stream of tourists throughout the year. Rental properties in Portugal’s Algarve offer excellent opportunities for generating consistent income, as the region remains a favorite among summer vacationers and off-season travelers.

Sintra

Famous for its fairy-tale palaces and lush landscapes, Sintra is an attractive destination for short-term rentals. The area’s unique charm makes it a sought-after location for vacation rentals, including luxury apartments. Property owners can capitalize on Sintra’s appeal to tourists seeking cultural and natural beauty, leading to high demand and potentially lucrative rental opportunities. In close proximity to a national park and various historical sites, there is also the beautiful Pena Palace that will make anybody want to apply for an extended stay.

Cascais

This picturesque coastal town near Lisbon offers a relaxed atmosphere and beautiful beaches. Cascais is a popular destination for those seeking a quieter alternative to Lisbon while still close to the capital. Vacation rentals in Cascais are in high demand, providing property owners with strong rental income prospects and a desirable location for short-term stays.

Local Accommodation Requirements

For your short-term rental property in Portugal, you’ll need to ensure it meets specific accommodation requirements:

  • The property can have no more than nine bedrooms and accommodate up to 27 people unless it’s a hostel.
  • It must be in good condition, with fully functional electronic installations, and connected to both the public water supply and sewage network. Additionally, it needs working tap water and at least one window or balcony for proper ventilation.
  • The property must be fully furnished, including kitchen utensils, and have at least one toilet for every four rooms or ten guests. For shared private bathrooms used by several rooms, there should be a door with a lock for privacy.
  • Common sanitary facilities must include at least one toilet, a washbasin, and a shower for every six guests. Properties with more than ten users must also comply with fire safety regulations.
  • A check-in reception service must be available in person, by telephone, or electronically. This includes providing clear house rules and ensuring a means of communication with the reception service.
  • Local accommodation operators must cooperate with national authorities by providing data on the number of users, overnight stays, and other necessary statistics.

Taxation on Your Short-Term Rental Portugal Activity

Regarding your short-term rental income in Portugal, you’ll need to navigate through specific tax regimes and obligations. Here’s what you need to know about the tax implications for your short-term rental Portugal activity:

Tax regimes

  • Simplified regime: If your earnings from local accommodation are less than €200,000 per year, you can opt for the simplified regime. Under this regime, only 35% of your taxable profit is subject to tax based on hotel services and similar activities. The remaining 65% is considered running costs and isn’t taxed.
  • Organized accounts: The organized accounts regime applies for earnings exceeding €200,000 annually. In this case, Corporation Tax (IRC) rules will determine your taxable profits. Here, a fixed rate of 21% applies to all earned profits.

Value added tax (VAT)

Local accommodation services are subject to a reduced VAT rate of 6%, which covers accommodation and breakfast costs. You can claim a VAT exemption if you’re on the simplified regime and your annual income is below €10,000.

If you’re not exempt, you’ll need to pay VAT through periodic returns, either monthly or quarterly, depending on whether your turnover is above or below €650,000. These returns should be submitted through the Portal das Finanças.

Understanding these tax regimes and VAT obligations will help you manage your finances effectively and comply with Portuguese tax laws.

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Frequently Asked Questions about Short-term Rentals in Portugal

What are short-term rentals in Portugal?

Short-term rentals in Portugal are furnished properties—such as apartments, villas, or rooms—rented out to guests for periods typically up to 30 days. These rentals, known locally as Alojamento Local (AL), are popular with tourists and must be registered and licensed to operate legally.

How do short-term rentals differ from long-term rentals in Portugal?

Short-term rentals (AL) are fully furnished and cater to tourists or temporary guests for stays of up to 30 days, requiring a specific license and compliance with safety and hospitality standards. Long-term rentals are typically unfurnished, intended for permanent residents, governed by different contracts, and do not require an AL license.

Are short-term rentals legal in Portugal in 2025?

Yes, short-term rentals are legal in Portugal in 2025, provided the property is registered and holds a valid AL license. However, new licenses are restricted or suspended in certain high-density or designated containment areas, especially in parts of Lisbon and Porto.

What are the new short-term rental regulations in Portugal for 2025?

The 2025 regulations give municipalities more control to restrict or suspend new AL licenses in high-density areas, allow AL licenses to be transferred with property sales, and remove the five-year renewal requirement. In many urban areas, new licenses are suspended until local regulations are finalized.

What is the AL (Alojamento Local) license in Portugal?

An AL (Alojamento Local) license is the official permit required to legally operate a property as a short-term rental in Portugal. It certifies that the property meets safety, hygiene, and legal standards for tourist accommodation and is mandatory for listing on platforms like Airbnb or Booking.com.

How do I get an AL license for short-term rentals in Portugal?

To get an AL license, register your property and business activity with the Portuguese tax authorities, submit an application and required documents to your local city hall, ensure the property meets safety and hospitality standards, and pass an inspection. Once approved, your property can legally operate as a short-term rental.

Can foreigners operate short-term rentals in Portugal?

Yes, foreigners can operate short-term rentals in Portugal. Non-residents must appoint a fiscal representative in Portugal, but otherwise enjoy the same rights and obligations as Portuguese citizens in obtaining and managing AL licenses.

Are there any restrictions on short-term rentals in Lisbon or Porto in 2025?

Yes, as of 2025, new AL licenses are suspended or heavily restricted in many central neighborhoods and parishes of Lisbon and Porto due to housing shortages and high AL density. Existing licenses remain valid, but new applications are generally not accepted in these areas.

What areas in Portugal are affected by short-term rental restrictions?

Short-term rental restrictions primarily affect high-density tourist areas, especially Lisbon (including Avenidas Novas, Alfama, Bairro Alto, Baixa, and others) and central Porto. Some areas have absolute bans, while others have limited or conditional licensing depending on AL-to-housing ratios.

What is the suspension of new AL licenses in Portugal?

The suspension of new AL licenses refers to the temporary halt on issuing new short-term rental permits in designated high-density or containment areas—mainly in Lisbon and Porto—while municipalities develop new regulations to balance tourism with housing needs. Existing licenses remain valid, and the suspension may be extended as local rules are finalized.

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