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Holiday let licensing


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Dennis Swing Greene is Senior Partner and International Fiscal Consultant for euroFINESCO s.a

TOURIST RELATED activities are normally considered commercial in nature, particularly when part of a regulated tourist development.

A villa or apartment used for such purposes must be zoned accordingly for the activity to take place on a legitimate basis.

On the other hand, normal housing developments, condominiums and isolated villas have the stated purpose of providing living quarters for their residents and are clearly ‘zoned’ residential. Non-permanent inhabitants, like holidaymakers, are by no means excluded from being considered part-time residents, however short their stay might be.

For a property to require a commercial licence (i.e. Moradia turística or Apartamento turístico) and be zoned ‘commercial’ when letting to tourists, it must be considered as part of a ‘tourist development’ or deemed to be a ‘complementary element’, engaged in the activity of providing ‘full service tourist lodging’ as defined in legislation.  

Renting law

Outside these parameters, ‘self-catering lets’ to holidaymakers currently fall under the General Renting Law (Novo Regime de Arrendamento Urbano), recently overhauled in 2006.  Renting to holidaymakers may be conducted with a Habitation Licence provided certain norms are followed.

If letting is more commercial in nature or the intention is to offer ‘full service’ rather than ‘self-catering’, an alternative option may be appropriate: Hospedagem (Guest house).  This specific property licence permits both private use as well as commercial tourist lets. This type of property licence is defined in local legislation and varies from council to council.

Analysis and Recommendations

euroFINESCO offers an analysis service to determine exactly where owners stand regarding requirements. If we determine that property licensing changes are not necessary, we will recommend how best to organise to be squarely on the correct side of the law, through our enhanced ‘Double Shield Protection Plan’.

Private consultations can be scheduled at offices in Guia (Albufeira), Lisbon (Chiado) and, starting January 2008, in Funchal (Sé), Madeira. In the Algarve, call 289 561 333, Lisbon at 213 424 210, Madeira at 291 221 095.