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Renting a Shop or Office in Portugal

Researched and written with AI tools from official sources. How we make our guides

How a commercial lease works in Portugal, the five year default, notice periods, who pays what, taking over a business, stamp duty, and VAT on the rent.

The Portugal Brief 9 min read

Renting a Shop or Office in Portugal

Last verified: October 2026.

Who this is for

  • You want to rent a shop, restaurant, clinic, studio, or office in Portugal.
  • You are taking over an existing business and its premises.
  • You own commercial premises and want to know the default rules.

Not for you if: you are renting a home to live in. Read Renting a Home in Portugal instead.

A lease for a shop or office (arrendamento não habitacional) follows its own rules in the Civil Code. Most of them can be changed by the contract. If the contract says nothing on duration, the lease runs for five years and renews automatically. Whatever the contract says, the landlord cannot block renewal in the first five years. The lease must be in writing, and the premises must be licensed for your activity. The landlord pays stamp duty of 10% of one month's rent. Rent is normally VAT-free, unless the landlord opts to charge VAT. This guide covers leases signed today; older leases have transitional rules of their own.

Which rules apply

A commercial lease is governed in this order:

  1. What the contract says. For duration, ending the lease, rent updates, charges, and repairs, the contract comes first.
  2. The rules for non-residential leases in the Civil Code. They fill gaps and set a few rules you cannot contract out of.
  3. The general lease rules, including some residential rules that apply where the contract is silent.

This freedom cuts both ways. A well-drafted lease can give a tenant far more than the law's default. A badly drafted one can give less. Read every clause.

Before you sign: the licence check

The lease must be in writing. If it was never written down and that is not your fault, you can still prove it. You show that you used the premises without objection and paid rent monthly for six months.

The premises must be fit for your purpose. The law says a lease can only cover premises whose suitability is certified by the authorities, in particular by a use licence (licença de utilização) where one is required. A flat licensed as a home is not licensed as a shop. If the licence does not match your activity, you may not be able to open.

Check two documents before you sign:

Some activities need their own permits as well. Ask the council what your business needs at that address.

How long the lease lasts

The parties are free to agree the term and the rules for ending the lease. If the contract says nothing:

  • The lease lasts five years. You, the tenant, cannot end it with less than one year's notice.
  • It renews automatically at the end of the term, for the same period again, or for five years if the original term was shorter.

The five-year floor. In the first five years after the lease starts, the landlord cannot oppose renewal, whatever term the contract states. So a one-year lease that renews automatically still gives you five years of protection against the landlord refusing to renew. Many tenants do not know this rule exists.

Notice periods

Where the contract says nothing about notice, the residential notice periods apply.

If the landlord wants to stop the lease renewing, they must tell you before the end of the term, at least:

  • 240 days before, if the term is six years or more
  • 120 days before, if it is one year or more and under six
  • 60 days before, if it is six months or more and under a year
  • one third of the term, if it is under six months

Remember the five-year floor above: in the first five years, the landlord cannot oppose renewal at all.

If you want to stop it renewing, the notice is 120, 90, or 60 days for the same bands, or one third of the term if it is under six months.

Ending the lease early. Once one third of the term or renewal has passed, you can end the lease at any time. You give 120 days' notice if the term is a year or more, or 60 days if it is shorter. If the landlord has blocked renewal, you can leave at any time on 30 days' notice. Your notice takes effect at the end of a calendar month.

If you give too little notice, the lease still ends, but you owe rent for the missing notice period.

When the landlord can end the lease

A landlord can only end a commercial lease on notice in two cases:

  • Demolition or deep renovation that requires you to leave, where no equivalent premises result in which the lease could continue.
  • Five years' notice before the date the landlord wants the lease to end.

The landlord's own need for housing does not apply to a commercial lease.

In either case, the landlord must compensate you and the business's employees separately for the losses the ending causes. You can claim for yours, and your staff can claim for theirs.

The exception. You get no compensation if you took over the lease through a business transfer (trespasse) in the previous three years.

Demolition or deep works has a strict procedure. The landlord must give at least six months' notice, stating the reason, with proof that the planning procedure has started and a statement from the project's technician. They must then confirm with the works licence and a council document. If a document is missing, the notice has no effect.

Rent, charges, and repairs

Rent updates. The contract can set how the rent is updated. If it says nothing, the landlord can update it once a year using the official coefficient. The first update can come one year after the lease starts. The landlord must tell you in writing at least 30 days before, with the coefficient and the new rent. A missed update can still be applied later, but not more than three years after it first became possible.

Running costs. If the contract says nothing, you pay the running costs for goods and services supplied to the premises, such as electricity and water.

Building charges. If the premises are a unit in a building with a condominium, the default is that the landlord pays the charges for the common parts. Many draft leases move these to the tenant, so read that clause carefully.

Repairs. The contract can say who carries out ordinary and major repairs. If it says nothing, the landlord does the conservation works. You are allowed to carry out works required by law or by the purpose of the lease. Write down clearly who pays for your fit-out and who owns it at the end.

When the lease can be ended for breach

Either side can end the lease if the other's breach is so serious that continuing is unreasonable. For a landlord, the examples include:

  • breaking rules on hygiene, noise, or good neighbourliness, or the building's rules
  • using the premises against the law or public order
  • using them for a different purpose than the one agreed, even without extra wear
  • not using them for more than a year
  • passing the premises to someone else in a way that is unlawful or invalid against the landlord

Unpaid rent. The landlord can end the lease by written notice if you are three months or more behind on rent or charges. You can cancel that by paying everything within one month, but only once per lease.

Repeated lateness. The landlord can also end the lease if you pay more than eight days late more than four times in 12 months. They must first warn you by registered letter after the third late payment.

The landlord must act within one year of learning of the breach, or three months for arrears or repeated lateness. You must leave one month after the lease ends, unless a court or an agreement sets another date.

Subletting and handing on the business

Subletting needs the landlord's written permission. An unauthorised sublet counts as approved if the landlord accepts the subtenant as such.

Business transfer (trespasse). You can transfer the lease to a buyer of your business without the landlord's permission. You can also transfer it to someone who will carry on the same liberal profession in the premises, or to a professional company doing the same work. The transfer must be in writing and notified to the landlord.

The law says there is no trespasse if:

  • the premises, equipment, stock, and other elements of the business are not transferred together, or
  • the buyer will run a different kind of business or use the premises for another purpose.

Buying an empty shell and calling it a trespasse does not transfer the lease. The landlord can treat it as an unauthorised transfer and end the lease.

The landlord's right of first refusal. If you sell the business by trespasse, the landlord can match the deal and buy it, unless the lease says otherwise. See Right of First Refusal on Property in Portugal for how preference rights work.

Letting out the business temporarily (cessão de exploração). You can hand over the running of your business and the premises for a fee, for a set time, without the landlord's permission. You must tell the landlord within one month. You stay the tenant.

Taxes

Stamp duty on the lease: 10% of one month's rent. This is the landlord's tax. The same 10% applies to a rent increase agreed by changing the lease. The landlord must register the lease with the tax office (Finanças) by the end of the month after it starts.

Stamp duty on a trespasse: 5% of the value. The buyer of the business pays it. On a large purchase price this is a real cost, so put it in your budget.

VAT on the rent. Renting property is normally exempt from VAT. The exemption does not cover:

  • hotel and similar accommodation, including campsites
  • parking areas
  • fixed machinery and equipment, and any letting that hands over the running of a business
  • safe deposit boxes
  • space for exhibitions or advertising

That is why a cessão de exploração normally carries VAT and a plain shop lease does not.

The landlord can opt to charge VAT. A landlord can waive the exemption when letting a building or unit to a business that uses it wholly or mainly for VAT-deductible activity. Special rules set the conditions. If your business reclaims VAT, this costs you little overall. If it cannot reclaim VAT, the rent goes up by the full rate, 23% on the mainland. Ask whether the rent quoted includes VAT before you agree it.

If the tenant dies

A commercial lease does not end when the tenant dies. It passes to the successors. They can refuse it by telling the landlord within three months, with copies of the documents that prove the death. If they keep it, they must tell the landlord within three months, or pay for any harm the delay causes.

A checklist before you sign

  • Does the use licence cover your activity? Check first, not last.
  • What term is written, and does it renew? With no term, you get five years and automatic renewal. With a short term, the landlord still cannot oppose renewal for five years.
  • Who pays the building charges? If the lease is silent, the landlord.
  • Who does the works, and who owns your fit-out at the end? Write it down.
  • Is a trespasse part of your exit plan? Note the landlord's preference right, the 5% stamp duty for the buyer, and the three years with no compensation.
  • Is the rent quoted with or without VAT? Ask before you agree.

If things go wrong, small money disputes can go to the peace courts (julgados de paz), which hear urban lease cases up to €15,000 except evictions. If you need a desk rather than premises, see Finding a Coworking Space in Portugal.

This guide is general information, not legal or tax advice. A commercial lease can be worth a whole business. Have a lawyer or solicitador review it before you sign.

Sources

This guide is written from official sources and, where relevant, organisations' own websites.

Last verified October 2026. Rules and fees change; check the official source before acting.

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