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CEAL – Extraordinary Contribution on Local Accommodation

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CEAL – Extraordinary Contribution on Local Accommodation

by | Wednesday, 10 January 2024 | Personal Income Tax, Real Estate

CEAL

In 2024, local accommodation establishments must pay a new tax called the “Extraordinary Contribution on Local Accommodation [alojamento local] (CEAL).

As part of the “Mais Habitação” programme (Law no. 56/2023, of 06/10), which introduced several legal changes to promote more affordable housing, an extraordinary contribution was created on flats and lodging establishments integrated into an autonomous fraction of a local accommodation building, the regime of which is published in an annexe to the aforementioned Law.

The CEAL is determined considering the economic coefficient of local accommodation and the urban pressure coefficient for the gross private area of the property applied to the gross area of the local accommodation.

Are all local accommodation units required to pay CEAL?

No, residential properties that do not constitute autonomous fractions or parts or divisions that can be used independently are exempt from CEAL.

Also exempt are local accommodation units, in autonomous fractions, which are their own permanent dwellings, as long as their operation does not exceed 120 days per year.

In addition, properties located in inland areas and residential properties that do not constitute autonomous fractions or parts capable of independent use are also excluded.

What is the methodology used to calculate the CEAL tax base?

The CEAL tax base applies the economic coefficient for local accommodation and the urban pressure coefficient to the gross private area of the property used for local accommodation.

The applicable rate to the tax base is 15 per cent.

According to the CEAL regime, published in Law no. 56/2023, the tax calculation depended on the government publishing two coefficients: the economic coefficient for LA and the urban pressure coefficient.

Through Order 455-E/2023, of 29/12/2023, only the urban pressure coefficient per parish was published.

The economic coefficient for local accommodation, which is still missing, is calculated using the ratio between the average annual income per room available in local accommodation, as calculated by INE, and the minimum gross area of a one-bedroom dwelling.

The ALEP – Associação do Alojamento Local em Portugal (Association of Local Accommodation in Portugal) estimates the economic coefficient for local accommodation at EUR 31.53.

So, as an example, in the case of a 100m2 flat in LA, located in the parish of São Martinho in Funchal, the taxable base would be EUR 1,561.37 (31.53 x 100 x 0.4952) to which applying the 15% rate would give a CEAL payable of 234.21 euros

Disclaimer: This article provides general information and should not replace personalized advice from tax professionals. The content is based on the available information at the time of writing and is subject to change. Please consult with professionals for advice tailored to your specific circumstances.

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