How to open a holiday let in Lagos: AL licence, requirements and timelines

Before you start: can the property be a holiday let?

This is always the first question, and in Lagos the answer is currently straightforward. The municipality has no containment areas and no municipal AL regulation, so an apartment or house licensed for residential use can, as a rule, be registered.

This may change. Municipalities with more than a thousand AL properties, such as Lagos, have until 31 December 2026 to decide whether to introduce their own rules. While preparing them, they can temporarily suspend new registrations. Existing registrations are not affected. If you are thinking about going ahead, it makes sense not to leave your application for later.

For apartments, the building’s condominium no longer needs to authorise the activity, except for hostels. Good relations with neighbours still matter: if there are repeated, documented disturbances, the condominium assembly can ask the council to cancel the registration. A well-managed property with clear house rules avoids this from the start.

If you live outside Portugal

Many owners in Lagos live abroad, in the United States, Sweden, the UK or elsewhere, and the process works for them too. A few points are worth knowing:

• Portuguese tax number (NIF). You will need one before opening activity with the tax office. If you bought property here, you most likely have one already.
• Power of attorney. If you can’t be in Portugal for the paperwork, a solicitor or lawyer can handle it on your behalf with a power of attorney (procuração).
• A local accountant. Choose one who knows holiday lets and works with non-resident owners. Rental income from Portugal may also need to be declared in your country of residence, so it is worth getting advice on both sides. This matters even more for US citizens, who are taxed on their worldwide income.

1. Registering with the tax office

The first formal step is to open activity on the Portuguese tax portal (Portal das Finanças), as business income (category B), under the activity code for tourist accommodation. This is also where the VAT regime is chosen.

Owners invoicing up to €15,000 a year can be exempt from VAT. Above that, accommodation is taxed at the reduced rate of 6%.

These choices affect your tax position for years, so we always recommend speaking to an accountant first.

2. AL registration (RNAL)

Registration is done online, through the government’s Balcão do Empreendedor portal, by submitting a prior notification. It requires Portuguese digital authentication. For many non-residents, this is a step the solicitor handles under the power of attorney.

The documents usually required include:

• ID of the operator, or company certificate if registering through a company
• property records and proof of the right to operate the property (deed, or a contract authorising it if you are not the owner)
• the property’s habitation licence, where applicable
• proof of the mandatory insurance
• a declaration of responsibility and proof of opening activity with the tax office

The council has 60 working days to object. If it doesn’t, the registration is granted, and the document with the RNAL number becomes your licence to open to guests and advertise the property.

In practice, 60 working days is close to three months. That is the timeline to plan around, especially if you want the property ready for the high season.

3. Property requirements

The property must be in good condition, with hot and cold running water, ventilation and suitable equipment for guests. There are also some specific requirements:

• Safety: fire extinguisher and fire blanket within easy reach, a first-aid kit, and the 112 emergency number on display.
• House manual: house rules, how appliances work, rubbish and recycling, noise rules, and a contact for the person responsible, in Portuguese, English and at least two other languages.
• Complaints book: both the physical book and the electronic version.
• Identification plaque, required for apartments (detached houses are exempt).
• Mandatory insurance covering civil liability for damage to guests and third parties.

The insurance deserves special attention. Its expiry date is now shown on the national register, and lacking valid insurance is grounds for the council to cancel the registration. It isn’t enough to have it at the start: it has to be renewed every year and the information kept up to date.

4. After the licence: ongoing obligations

Once registered, the property can be listed on Airbnb, Booking.com and other platforms, always with the RNAL number shown. From then on, there are regular obligations:

• Reporting foreign guests through the SIBA portal, within three working days of check-in and check-out.
• Invoicing every stay to the guest.
• Tourist tax, depending on the municipality. In Portimão it is €2 per person per night from April to October and €1 from November to March, up to 7 nights, for guests aged 13 and over. Lagos and Vila do Bispo currently have no tourist tax.

5. Taxes, in broad terms

Income from a holiday let is declared for Portuguese income tax. How it is taxed depends on the regime chosen and on each owner’s situation. There are also reporting obligations linked to the commissions charged by foreign booking platforms.

For non-resident owners in particular, a good accountant who knows holiday lets is worth having from day one.

A final note

Opening a holiday let involves several steps, but with good preparation it is nothing complicated. At Rentalgest we support owners in Lagos, Vila do Bispo and Portimão with the registration, preparing the property and everything that comes after.