Selling a Second Home: Only One of These Three Countries Rewards Holding It

The word «taper» is doing a lot of work it should not be doing

Property advice written for one market gets exported to another and the vocabulary survives the journey even when the rule does not. «Hold it long enough and the tax goes away» is true in France and false in Spain, and in Portugal it is true for a completely different reason that produces a completely different number. Anyone budgeting a sale across two of these countries on a single mental model will be wrong in at least one of them.

It is worth being precise about what each mechanism is actually for. A taper is a policy choice to reward long holding and to blunt the effect of taxing nominal gains. An inflation coefficient is an attempt to tax only the real gain. A flat percentage exclusion is a rough compromise that does neither properly but is cheap to administer. France chose the first, Portugal chose the second and third together, and Spain chose to tax the nominal gain in full — a decision it made explicitly in 2014 by repealing the indexation it used to have.

France: two tapers running at different speeds on the same gain

A French property gain carries income tax at 19 % and social levies at 17.2 %, and each has its own allowance schedule. Both start counting after the fifth full year of ownership, which is why selling in year five is exactly as expensive as selling in year one. From year six the income-tax allowance runs at 6 % of the gain per year, so by year twenty-one it stands at 96 %, and a final 4 % in year twenty-two takes it to 100 %. The social-levy allowance runs at 1.65 % per year over the same stretch, reaching 26.4 % by year twenty-one, then 1.60 % in year twenty-two and 9 % per year from year twenty-three, hitting 100 % only in year thirty.

The practical consequence is a cliff between year twenty-two and year thirty that catches a lot of people out. At twenty-two years the income-tax half of the bill vanishes and the seller feels the relief; the social-levy half is still 72 % intact, which on a 150,000-euro gain is 18,576 euros. Those last eight years then remove the rest at 9 % a year, four to five times faster than the earlier stretch. If a sale is genuinely flexible and the property is somewhere between twenty-two and thirty years old, the arithmetic of waiting is worth doing properly.

Spain: the relief people remember stopped applying to purchases in 1994

Spain did once have reducing coefficients, and their memory is remarkably durable. Under the transitional rule that survives them, they apply only to assets acquired before 31 December 1994; only to the part of the gain considered to have accrued up to 19 January 2006; and only while the seller's cumulative transfer values, counted across every disposal since 1 January 2015 that has claimed the relief, stay under 400,000 euros. A flat bought in 2005, or 2015, or 2024 gets none of it.

What remains is a straightforward tax on the nominal gain at the savings scale: 19 % on the first 6,000 euros, 21 % to 50,000 euros, 23 % to 200,000 euros, 27 % to 300,000 euros and 30 % above, the top band having been added by Ley 7/2024. On a 150,000-euro gain that is 33,380 euros, an effective 22.25 %. Compare that with the French 22,265 euros after twenty years of ownership and the ranking flips depending entirely on how long the property was held — which is precisely the point.

Portugal: an inflation coefficient, then half the gain disappears

Article 50 of the Portuguese income tax code says that the acquisition value is corrected by coefficients approved each year by ministerial order, whenever more than 24 months have elapsed between acquisition and disposal. The order for disposals made during 2025 was published on 11 November 2025 and puts 2006 at 1.34, 2011 at 1.24, 2016 at 1.19, 2021 at 1.16 and 2024 at 1.00. The order for 2026 disposals follows the same annual rhythm and had not been published when this was written, so a 2026 seller cannot yet compute the exact figure — the mechanism is certain, the coefficient is not.

The second step is the one that changes the shape of the answer. Article 43 of the same code provides that the balance of gains and losses on immovable property is «considered at only 50 % of its value». Since Lei 24-D/2022 that halving applies to non-residents on the same footing as residents, with the balance then taxed at the general progressive rates rather than at a flat rate, and with a non-resident's worldwide income taken into account in setting the average rate. On our example — bought for 200,000 euros in 2006, sold for 350,000 euros in 2025 — the nominal gain of 150,000 euros becomes 82,000 euros after the coefficient and 41,000 euros after the halving, before any deductible acquisition costs and improvement works.

The exemptions that beat any taper

Before optimising a taper, check whether the sale is exempt outright. All three countries exempt or heavily relieve the sale of a main residence, on definitions that differ in the detail and are strict about actual occupation. Portugal goes further and exempts a main-residence gain that is reinvested in another main residence within the statutory window, with a separate route for sellers aged 65 or over or already retired who put the proceeds into a qualifying pension product. Spain has its own reinvestment relief for the habitual residence and an age-based relief for older sellers. None of these applies to a second home, which is exactly why second homes are where the taper question arises at all.

The second thing worth more than the taper is the acquisition base itself. All three systems let you add the costs of buying and certain improvement works to the price you paid, which reduces the gain at the source rather than shaving a percentage off it later — and every euro added to the base is worth its full marginal rate, whereas a year of taper is worth a few percent. Keep the deeds, the transfer-tax receipts and the builders' invoices. Their rules on what counts and what proof is required differ, so the practical instruction is the same everywhere: keep everything, and ask what qualifies before the work is done rather than after the sale.

Frequently asked questions

Does the French taper apply to a non-resident seller?

The holding-period allowances are computed the same way regardless of where the seller lives, because they attach to the property and the dates rather than to the person. What changes for a non-resident is the surrounding machinery: the levy may be collected at the point of sale through a fiscal representative, and whether social levies apply at the full rate or at the reduced solidarity rate depends on which country's social-security scheme the seller belongs to. Ask about the representative requirement before the deed is drafted, not after.

Is a partial year of ownership counted in the French taper?

No. The allowance accrues by complete years of ownership counted from the date of acquisition, so a sale eleven months and three weeks after an anniversary carries the same allowance as one the day after it. Where a sale is discretionary, checking the acquisition date on the deed before agreeing a completion date is one of the cheapest pieces of planning available — a few weeks can be worth 6 % of the whole gain in income tax alone.

If Spain has no taper, does inflation mean I am taxed on a loss?

In real terms that can happen, and it is the direct consequence of a deliberate policy choice: Spain removed the indexation of acquisition values for disposals from 1 January 2015 and taxes the nominal gain. A property that merely kept pace with prices over twenty years still produces a taxable gain. This is the single most important thing an owner used to the French or Portuguese systems has to internalise before modelling a Spanish sale, because the intuition imported from either of them will understate the bill.

Where do I find the Portuguese coefficient for the year I am selling in?

In the Diário da República. A portaria is published towards the end of each year giving the coefficients for assets disposed of during that year, indexed by the year of acquisition. The one covering disposals in 2025 is Portaria n.º 382/2025/1 of 11 November 2025. Because the order is published late in the year it covers, a seller completing in the first half of a year is working with a coefficient that does not exist yet — plan on the previous year's figure as an approximation and settle on the published one when the return is filed.

Can a loss on one property offset a gain on another?

The three systems differ sharply here, which is why it is worth checking before rather than after. Portugal is the most generous by construction: article 43 speaks of the balance between gains and losses realised in the same year, so offsetting is built into the definition. Spain allows losses to be set against gains within the savings base under its own ordering and carry-forward rules. France is the most restrictive on property: a loss on a disposal is generally not deductible against a gain on another. Never assume a portfolio-level netting rule that your country of residence has and the country of the property does not.