Rental yield calculator (Portugal)
A rent of 1,100 € a month is not 13,200 € in your pocket. Enter the property value, the rent and the annual costs: we show what is actually left, before and after tax.
The property and the rent
If you expect one empty month between tenancies, enter 1. If the flat is always let, leave 0.
Annual costs
Income tax effect (optional)
The rate depends on the type and length of the lease, your tax residence and whether you opt for aggregation. The 25 % shown by default is only a starting point: confirm the rate that applies to you before making any decision.
Enter the property value and the monthly rent to see the figures.
How the figures are worked out
- Gross annual income: the monthly rent multiplied by the months the property is actually let. If you expect one empty month between tenancies, that is 11 months, not 12.
- Gross yield: gross annual income divided by the property value. It is the figure listings like to show, and it is always the prettiest one.
- Net income before tax: all annual costs are deducted from the gross figure (IMI, service charges, insurance, maintenance and, if you use one, the management fee).
- Net yield: net income divided by the property value. This is the number worth comparing with other uses of your money.
- Tax effect: the rate you enter is applied to the net income, to give you an order of magnitude of what reaches your account at the end of the year.
Costs people forget
The four classics are IMI (the council tax), service charges, insurance and maintenance. Maintenance is the one nearly everyone underestimates: boilers, appliances, repainting between tenants, small repairs. A common rule of thumb is to set aside 5 % to 10 % of the annual rent for it. If an agency manages the property, add the management fee: in the Lisbon market it is usually around 12 % of the rent plus VAT, though it varies with the service included.
Why gross yield flatters
Roughly a third of the income disappears between gross and net. A 250,000 € flat let at 1,100 € shows a gross yield of 5.3 %, which easily falls to around 3.5 % after costs, and lower still after tax. That is not a reason to be discouraged: it is a reason to compare properties using the right number. A flat with high service charges and building works ahead can return less than one with a lower rent and predictable costs.
Frequently asked questions
Should I use the purchase price or the current market value?
It depends on the question you are asking. The purchase price shows the return on the money you actually invested. The current market value shows the return on the capital sitting in the property today, which is the figure to look at if you are considering selling and investing elsewhere.
What tax rate should I enter?
The tool deliberately does not decide for you, because the rate depends on the type and length of the lease, your tax residence and whether you opt for aggregation. We put 25 % as a starting point only. Confirm the rate that applies to you, with the tax authority or an accountant, before making decisions.
Are all the costs I enter deductible?
No. The rules for deducting expenses under category F are narrower than a landlord’s real cost list. IMI and service charges are normally deductible, and so is conservation work, but limits and exclusions apply. Our estimate simply applies your rate to the net income, which is an approximation and not a tax return.
Should I assume months without a tenant?
If you are assessing an investment over several years, yes. There is almost always a gap between one tenant leaving and the next moving in, with cleaning and works in between. One month a year is a prudent assumption for long-term lets in Lisbon.
Does the mortgage belong in this calculation?
Not in this tool, which measures the return of the property itself. If you have a mortgage, the interest is an extra cost while the capital repaid is saving, not spending. Keep them separate so you do not mix the performance of the asset with the way you financed it.
See the real income, month by month
The platform records the rent received and the costs of each property, and shows you the net income without any spreadsheets.
Try free for 14 daysRead the guide on rental income tax (category F)
See our rental management service in Lisbon
Informative tool, not a substitute for tax or financial advice. Rates and rules change: always check your own situation.