How to obtain an Alojamento local license in Portugal WithPortugal
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How to obtain an Alojamento local license in Portugal

Author: Daria Verba PUBLISHED ON: PUBLISHED IN: Real estate Portugal

If your goal is to rent out your property to tourists, the first important step is to obtain a local accommodation license (Alojamento Local, abbreviated AL). Here is a detailed guide on how to obtain an Alojamento Local license in 2024

A license (licença de alojamento local) is one of the first steps to opening a local accommodation business. If you are thinking of opening an AL, you will have to go through several bureaucratic procedures before you can start hosting guests. The AL procedure is free and can be done online, it is mandatory and allows owners of short-term rental properties to avoid hefty fines ranging from 2,500 to 4,000 euros for individuals and 25,000 to 40,000 euros for businesses.

 

The concept of AL local accommodation management. The concept of Alojamento Local covers establishments that provide temporary accommodation services for a fee. An AL is considered to exist if it is advertised as temporary accommodation (mainly for tourists). AL is also defined as furnished and equipped accommodation that publicly offers, in addition to overnight accommodation (for less than 30 days), services that complement the accommodation, such as, for example, cleaning or meals. They can function in four forms:

  • Home: AL, a unit of which consists of a self-contained house.
  • Apartment: AL, a unit of which consists of a self-contained portion of a house or a portion of a multifamily building that can be used independently.
  • Co-housing establishments (which include hostels): AL, whose units of accommodation consist of rooms combined in a self-contained part of a house, apartment building, or part of an apartment building that can be used independently. They may use the name "hostel" if the predominant unit of accommodation is a so-called hostel and if they meet other requirements established for this purpose. As of February 4, 2021, hostels are subject to new requirements - see Decree No. 262/2020 of November 6.
  • Rooms. In this case, the lodging license is valid at the residence of the person granting the rental, which corresponds to his tax address. Each room is considered a unit of accommodation, in which case the owner is prohibited from having more than three.
 

The maximum AL capacity is 9 rooms or 30 guests, except for hostels, which have no capacity limit, and rooms, of which there can only be 3 in the owner's residence. The AL capacity in terms of number of tourists is also limited depending on the characteristics/size of the accommodation and cannot exceed the number obtained by multiplying the number of rooms by 2. In apartments and houses, there is also the possibility of accommodating two additional guests in the living room, according to the INE figures. In all types of dwellings, up to two extra beds for children under 12 years of age can be installed, subject to availability of accommodation.

In the case of apartments, each owner or AL owner may operate no more than nine units per building, and only if their number does not exceed 75% of the number of existing apartments in the building. When calculating the number of apartments to be operated, apartments registered in the name of the owner's spouse, descendants and relatives in the ascending line, as well as apartments registered in the name of separate legal entities in which there are common partners, are considered. The legal regime applicable to AL is described in maximum detail in the latest guide to this type of accommodation - Guia alojamento local: regime jurídico (version of March 2024).

How do I apply for an AL license?

The application for AL registration can be submitted online through Balcão Único Eletrónico. Each application is assigned a registration number, which allows the AL holder to conduct public activities. The time limit for issuing a license is usually 10 days, and in the case of a hostel, up to 20 days, if there is no objection from the competent Câmara Municipal. Such opposition may be due to inaccuracies in the application, the lack of a proper building permit or the violation of established restrictions, which may be related to special zones defined by the Câmara Municipal or, for example, a temporary ban on registration. Restriction zones or temporary bans on registration occur in areas where the percentage of AL in relation to affordable housing for urban residents exceeds 25%. Before applying for an AL license, it is necessary to find out the situation in the area (freguesia) where the property is located. Note that the electronic platforms (booking.com, Airbnb, etc.) that advertise and therefore rent out your accommodation are required by law to require the property owner and display the RNAL registration number on their platform. On the Sistema de Informação Geográfica do Turismo SIGTUR website, you can view all ALs registered in the Registo Nacional de Alojamento Local (RNAL) and check their geo-referenced location.

 

What you will need to get an Alojamento Local

When applying for AL, documents identifying both the property itself and the owner responsible for its operation must be attached. Copies of the following documents should be provided:

  • Identity document of the property owner responsible for the operation of the AL (in the case of a natural person) or indication of the access code to the permanent certificate of the commercial register (indicação do código de acesso à certidão permanente do registo comercial), if the owner is a legal entity;
  • A liability document signed by the property owner assuring that the building or part of it can be used for occupancy and that it (or part of it) complies with all legal regulations;
  • Land Registry for the property (Caderneta predial do imóvel), if the applicant is the owner;
  • A lease agreement or other document legitimizing the owner's right to operate;
  • Declaration filed with the AT Tax Office of the commencement or change of activity of the self-employed or self-employed owner of the establishment (Declaração AT de início ou alteração de atividade);
  • If it is a condo in an apartment building that will be used as an AL - minutes of the condominium owners meeting authorizing the commencement of its operations.
  • A condominium owners' meeting may oppose an AL activity by resolution of at least 2/3 of the total number of owners, unless the Condominium Bylaws expressly provide for the use of a portion of the building for AL purposes or there is an express resolution of the condominium owners' meeting to that effect.
  • Violation of the decision of the general assembly or concealment of this information means immediate termination of AL activities, and the condominium owners' assembly must inform the head of the municipality of its decision, which takes effect within 60 days. Owners of AL establishments located in apartments must post in a conspicuous place inside the apartments a sign with the rules of conduct stipulated in the General Regulation on Noise (Regulamento Geral do Ruído).
  • Number of the building use permit (Número de título de autorização de utilização do edifício) if dated after 1951.
 

Once a pre-application has been submitted, Câmara Municipal will conduct a review to ensure that all legal requirements are met.

The following are the basic conditions that must be met to register Alojamento Local:

  • Legally compliant conditions for the operation of the premises facilities and equipment;
  • The facility must be connected to a public water supply or have a private water supply system with proper control of its origin;
  • The facility shall be connected to the public sewer system or have a septic tank designed for the maximum capacity of the establishment;
  • Have a hot and cold water supply;
  • Have a window or balcony with direct access to the outdoors that provides adequate ventilation and air access;
  • Be equipped with appropriate furniture, equipment and utensils;
  • Have a system of protection from outside light (curtains or blinds);
  • Have doors equipped with a security system that ensures, among other things, the privacy of users;
  • Bathrooms should be equipped with locking systems (simply put, latches or locks);
  • Have an information book on the operation of the establishment and the internal regulations (livro de informações sobre o funcionamento do estabelecimento e respetivas regras de utilização internas). The book must be available in Portuguese, English and at least two other foreign languages.
 

In terms of safety requirements, AL must haves:

  • Fire extinguisher and fire blanket (Extintor e manta de incêndio) available to guests;
  • First aid equipment (Equipamento de primeiros socorros) available to guests;
  • A sign showing the national emergency number (112) in an accessible location;
  • A book of complaints (Livro de reclamações). The use of the complaint book in electronic format is mandatory and the operator of the local accommodation facility must inform the user/consumer of the existence of the electronic format of the complaint book and publish access to the digital platform on their websites as well as in the apartments in a visible and conspicuous place: www.livroreclamacoes.pt. Upon receipt of a complaint through the platform, AL shall respond to the consumer within a maximum of 15 working days to the e-mail address provided on the form, informing him/her of the action taken on the complaint. Complaints are received directly by the Autoridade de Segurança Alimentar e Económica (ASAE), accompanied by a response from the company complained against and other information that the operator may wish to send to clarify the situation. ASAE will take the measures it deems necessary, namely initiating the appropriate procedure if the facts arising from the complaint indicate a practice of administrative offenses, informing the complainant of the procedure adopted. The availability and accessibility of an electronic grievance book does not negate the obligation to simultaneously provide a physical grievance book in AL. Further information regarding the application of the complaint book and the process of processing consumer complaints can be obtained from the Directorate General of Consumer Affairs/Complaint Book Support Unit (Direção-Geral do Consumidor/Equipa de Apoio do Livro de Reclamações): tel. 217810875.
  • Multi-factor liability insurance that protects your assets and claims in the context of your tourism activities, including covering fire risks and property damage to guests and third parties.
 

Everything you need to know when registering AL from a taxation point of view

What type of activity is best suited for your type of AL? The first step to register AL with the tax office is to choose the most appropriate economic activity code (CAE). The two available options related to this sector (CONSULTORIA TURISMO E HOTELARIA - GESTÃO DO SETOR DO TURÍSTICO) are as follows:

  • 55201 (Furnished Tourist Accommodations): This option refers to lodging furnished and equipped for tourist purposes, with tourist reception and cleaning services, and may or may not include breakfast.
  • 55204 (Other short-term accommodation): This option refers to accommodation furnished and equipped for tourist purposes, without reception and cleaning services, with a maximum stay of 30 days.

This activity can be carried out by both individuals and legal entities and always requires, as noted above, an AL license.

Individuals: If you are self-employed, you must file a declaration of commencement of activity (declaração de início de atividade) through the Portal das Finanças, at any tax office (serviço de Finanças) in person or at a loja de cidadão multifunctional center. If you already have an open activity, you need to file a declaration of changes (declaração de alterações), according to the CAEs mentioned above, through the same communication channels.

 

Legal entities. Companies (legal entities), need a certified accountant to set up the company and register it with the Commercial Register (Conservatória do Registo Comercial). The accountant will also be responsible for monitoring and ensuring compliance with all tax obligations.

VAT (IVA) related tax liabilities in AL are important to ensure the regularity of your business.

  • Invoicing: Invoices issued must show a VAT rate of 6% on the mainland, 5% in Madeira and 4% in the Azores.
  • Periodic VAT return (Declaração Periódica de IVA): The filing of a periodic VAT return is mandatory and can be done monthly or quarterly through Portal das Finanças. The frequency depends on the turnover: monthly for amounts over 650,000 euros and quarterly for smaller amounts.
  • VAT exemption scheme (Regime de Isenção de IVA). You can opt for the VAT exemption scheme if the following conditions are met: you do not have an annual turnover of more than 12,500 euros, you do not supply goods or services listed in Annex E of the VAT Code (anexo E do Código do IVA), you do not carry out import or export operations or related activities, and you do not have organized accounting.
 

Taxation of AL

Local residence income may be classified as Category B rendimentos empresariais e profissionais (business and professional income) or Category F rendimentos prediais (property income) on your personal income tax return (eclaração de IRS). To help you decide, run an IRS simulation for both categories before filing your tax return (simulação de IRS).

Category B: Simplified treatment (annual income up to 200,000 euros): taxation of only part of the income (coefficient) at the rate corresponding to your tax scale. Coefficients vary from 10% to 50%, depending on the type of AL and its location.

Category F: taxable income: difference between income and activity expenses. Non-deductible expenses: furniture, decoration, household appliances. 

Simplified treatment or organized accounting?

Organized accounting is mandatory for annual turnover of more than 200,000 euros. Organized accounting can be advantageous in some cases, as it allows you to deduct expenses that you incur within your business. If your AL expenses exceed 65% of your income, consider this option. On the other hand, if your turnover does not exceed €200,000, you can opt for the simplified regime.

Commissions from foreign sites

If you advertise the property on international platforms such as booking.com or Airbnb, you must take these expenses into account when filing your personal income tax return under category F rules. Thus, you must perform two tax operations: submit a model 30 declaration (declaração modelo 30) to the tax authority: Reporting of income paid to non-residents (up to 2 months after payment), and Form 21-RFI (Modelo 21-RFI): avoidance of double taxation (provided by the platforms). 

How to terminate an AL activity

To terminate your Alojamento Local business, you need to take several important steps. First, you must send a preliminary notification stating the deadline for terminating the establishment (comunicação prévia com prazo de cessação da exploração do estabelecimento) through Balcão Único Eletrónico. After closing through prior notification, it is necessary to notify the tax authorities of the termination within 30 days. This can be done in person at the tax office or online through Portal das Finanças. It is significant to follow these steps correctly to ensure that the closure of the accommodation facility is properly registered and that all tax and legal obligations related to the activity are properly fulfilled. So that you do not have to hire a lawyer to settle matters with the regulatory authorities at a later date.

In addition to the AL license, it is important to know all your obligations related to this type of activity, such as the process of cooperation with the SEF (Serviço de Estrangeiros e Fronteiras). This Turismo de Portugal guide compiles all the information, including the legal framework. The AL legal regime, created in 2014 and amended in 2018, sets out the rules for this activity. You can find them here. The Association of Local Accommodation Facilities in Portugal (Associação Alojamento Local em Portugal) also has useful and up-to-date information on this subject.

This article was very intense, but I hope you managed to read to the end. For the most inquisitive, as always in such cases, I leave a list of handy materials in Portuguese for organizing AL:

As well as the entire legislative framework concerning AL in one compilation:

I would like to remind you that on our portal you have at your disposal a huge knowledge base on various areas of life in Portugal: read and comment.

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