The treaty rule
Article 13 of the 1980 convention: gains from immovable property may be taxed where the property is; gains from anything else — shares, funds, bonds, crypto — are taxable only in the residence state. Article 24 then makes Portugal credit the German tax on the property gain, and makes Germany exempt (with progression) the Portuguese-property gains of its residents.
| You are Portuguese resident and sell… | Germany | Portugal |
|---|---|---|
| a German flat within 10 years of purchase, never self-used | taxes the full gain at the tariff (limited liability) | taxes 50 % of the gain at progressive rates, credits the German tax |
| a German flat after 10 years, or your former home (self-used in the year of sale and the two before) | nothing (§ 23 EStG) | taxes 50 % of the gain — nothing to credit |
| German shares, ETFs, a GmbH stake below 1 % | nothing | 28 % (or aggregate), with the holding-period reductions on listed securities |
| a GmbH stake of 1 % or more | taxed the exit tax on departure (AStG § 6) — not again on sale, unless the value rose | 28 % on the gain since acquisition; Portugal credits nothing for the exit tax |
- 10 years German speculation period on property; self-used homes exempt
- 50 % of a property gain taxable in Portugal at 12,5–48 %; not 28 %
- Credit for German tax in Portugal, capped at the Portuguese tax on the same gain (art. 81.º)
- No rebasing on arrival: Portugal measures the gain from the original German purchase price
Germany’s side in detail
- Speculation period (§ 23 EStG). A private property sold within ten years of the purchase date generates taxable “other income”: sale price less purchase price, costs and depreciation claimed. Sold after ten years: tax-free, resident or not.
- Own home. Exempt at any time if used exclusively as your own home between purchase and sale, or in the year of sale and the two preceding calendar years — a rule that still protects a home you left less than two full years before selling.
- Non-residents. Germany keeps the right under § 49 EStG and the treaty; the return goes to the Finanzamt of the property’s location with the tariff applied from the first euro (no Grundfreibetrag).
- Shares. Non-residents are outside German tax on portfolio gains; the exit tax at departure covers holdings of 1 % or more.
Portugal’s side in detail
- Property anywhere in the world sold by a resident: the gain (price minus purchase price indexed by the official coefficients, minus purchase and sale costs and improvements of the last twelve years) is included at 50 % and taxed at the general rates with your other income. There is no 28 % option for property.
- Foreign tax credit (art. 81.º): the German tax is credited up to the Portuguese tax on the gain; a German liability above that ceiling is lost.
- Main-home reinvestment: the exemption of art. 10.º n.º 5 requires the sold property to be your main home at the time of sale and the proceeds to buy a new main home in Portugal or the EU/EEA within 36 months. A German flat sold two years after you moved out does not qualify — it was no longer your home. Selling it before the move, while it is still your home, keeps both exemptions.
- Securities: 28 % flat, reduced by 10 % / 20 % / 30 % of the gain for listed securities and open funds held more than two, five or eight years; losses offset within the category (five-year carry-forward if aggregated). Crypto held 365 days or more is exempt.
Worked example
Flat in Frankfurt bought in 2019 for 400 000 €, sold in 2027 for 560 000 €, let since 2023, owner resident in Portugal since 2024. Gain 160 000 € (ignoring costs and depreciation).
- Germany: within ten years, taxable — roughly 60 000 € at the tariff on 160 000 € of income (no allowance for a non-resident).
- Portugal: 80 000 € (half the gain, after the indexation coefficient) added to income — roughly 38 000 € if your other income already reaches the top bracket; credit for the German tax capped at that 38 000 €, so nothing more to pay here.
- Total: about 60 000 €. Sold in 2029 instead (after ten years): Germany 0, Portugal about 38 000 €. Sold in 2023 before leaving, while still your home: Germany 0 under the self-use rule, Portugal not involved.
Sequencing before the move
List the assets by German rule
Properties with their purchase dates and use; shares with the 1 % test; funds and crypto.
Sell what Germany exempts and Portugal would tax
The own home; shares and funds under the Abgeltungsteuer if the German 25 % beats the Portuguese 28 % — usually yes for short holdings, not after eight years.
Keep what needs the ten years
A let German property inside the speculation period is better sold after year ten: Germany then charges nothing and Portugal only half the gain.
Declare in both
German return for the property year; Portuguese annex J with the German tax paid for the credit.
We compute the Portuguese tax on your German assets before you fix the moving date and file annex J with the German credit afterwards; your Steuerberater handles the German return. Send us the list.
Questions
Does Portugal apply the German ten-year exemption?
No. Portugal taxes half the gain on any property, however long you held it. Indexation of the purchase price for inflation softens it on old holdings.
Can I offset a loss on German shares against Portuguese gains?
Losses and gains on securities are netted in Portugal within the year wherever the securities are; the net loss carries forward five years only if you opt to aggregate the category.
Is the exit tax credited in Portugal when I later sell the GmbH shares?
No. Portugal taxes the gain from your original acquisition cost at 28 % and grants no credit for a German tax on an earlier deemed sale. The exit tax and the Portuguese tax overlap on the same appreciation; a sale or gift before departure avoids the duplication.
Sources and official references
- Bundestag Drucksache 9/897 — Convention Germany–Portugal 1980: art. 6 (immovable property), art. 13 (gains: property where situated, other gains in the residence state), art. 24 (methods) — checked 18.9.2026
- EStG § 23 — private sales: property within 10 years of purchase taxable; exemption for self-used homes; other assets within 1 year — checked 18.9.2026
- EStG § 49 — limited tax liability: gains on German property by non-residents — checked 18.9.2026
- AStG § 6 — exit tax on shareholdings of 1 % or more — checked 18.9.2026
- Código do IRS, artigo 10.º (n.º 5 reinvestment; n.º 22 crypto) and artigo 43.º (property gains at 50 %; securities held 2/5/8 years) — checked 18.9.2026
- Código do IRS, artigo 72.º (28 % on securities) and artigo 81.º (foreign tax credit) — checked 18.9.2026