Vehicle Registration in Portugal and Import Tax Considerations
Portugal imposes significant indirect taxes on vehicle purchases, with rates varying based on engine capacity and CO2 emissions. These taxes apply to both new and imported used vehicles, including an annual depreciation rate. These charges are in addition to the standard VAT paid at purchase and annual vehicle taxes (IUC).
Importantly, Portugal offers an import tax (ISV) exemption for new permanent residents. The basic requirements for this exemption are:
- You must have owned the vehicle’s registration for at least six months before arriving in Portugal
- The exemption is limited to one vehicle per person
Registration Process
First, obtain your European Certificate of Conformity (COC), which typically requires about 6 weeks. After arriving in Portugal:
- Complete a technical inspection
- Submit customs declaration (must be done within 20 days of arrival)
Additional requirements:
- The vehicle must have been purchased in your previous country of residence
- You must have lived in that country for at least 12 months prior to moving
- The vehicle must not have received any tax benefits in your origin country (this affects hybrid vehicles and company/leased cars)
The application is submitted online, and many local agencies can assist with the process. All procedures must be completed within 12 months of arrival to qualify for the exemption.
Mandatory Registration for Residents
Once you become a resident (staying more than 183 days per year), Portuguese registration becomes mandatory. You cannot drive a foreign-registered vehicle as a resident. This rule is strictly enforced due to Portugal’s higher vehicle taxation compared to neighboring countries.
Alternative Option: Consider selling your current vehicle in your home country and purchasing a Portugal-registered vehicle. This can be advantageous, especially with Portugal’s extensive electric vehicle charging network and lower annual taxes for smaller engines and lower emissions.
