VAT at 6% in rehabilitation work: what changed for painting

Anyone planning to paint their house or building may have heard of a recent tax change that directly affects the final invoice amount. This is not another generic explanation of VAT rates, but a legal clarification published in 2026 that resolves a long-standing question about work in historic and older areas of several Portuguese cities. Understanding this change can help confirm whether the painting quote received is applying the correct rate.

What changed with the new 2026 law

A clarification, not a new rule

In August 2026, a law was published that provides official interpretation of a VAT Code provision that has existed since 2009. Law No. 48/2026, published on August 17, clarified the conditions under which urban rehabilitation contracts pay VAT at the reduced rate of 6% instead of the usual 23%.1 This is relevant because, until this clarification, there was a more restrictive interpretation defended by the courts.

Before this law, a ruling by the Supreme Administrative Court had reinforced that, even in areas classified as ARU, the reduced rate could only be applied when the property was included in a formally approved Urban Rehabilitation Operation2. In practice, this excluded many buildings located in old areas of cities like Braga, Coimbra or Faro, simply because the municipality had not yet formalized the administrative process of the operation.

What now counts for reduced VAT purposes

With the new interpretation, the criterion became simpler to confirm. For the reduced rate purposes, contracts carried out on properties or public spaces located in urban rehabilitation areas defined under the law apply, regardless of whether or not there is an approved urban rehabilitation operation for that building. In other words, it is enough that the address falls within the limits of an ARU recognized by the municipal authority.

This clarification also has an unusual effect: it applies retroactively. This means it covers work already completed, work in progress, and work not yet started. For anyone who paid the standard rate on recent facade or building painting work in a rehabilitation zone, it may be worth reviewing that invoice.

What this means in practice for painting quotes

How to confirm if the address is in an ARU

Before requesting a quote, it is worth knowing whether the property is within a defined urban rehabilitation area. Municipal authorities have this information available and, in border areas between ARU and common area, the difference may literally be in the house number.

• Check the local municipal authority website or the Housing Portal to verify if the address is listed in the ARU list.
• Request written confirmation from the Civil Parish Assembly when there is doubt about the exact boundaries of the zone.
• Keep this confirmation with the quote, as it may be needed if there is a later invoice review.

The impact on final value

The difference between the two rates is not symbolic. The difference between the two rates is 17 percentage points and, in a purely illustrative example, for a taxable base of 100,000 euros, VAT would be 6,000 euros at the 6% rate and 23,000 euros at the 23% rate, a difference of 17,000 euros. Even for a more modest facade painting job, the difference between the two rates affects the final quote.

This table is indicative only; the specific tax treatment of each contract must be confirmed before invoice issuance, preferably with the hired professional or company.

What to do before requesting a painting quote

This tax clarification does not replace the usual care when comparing proposals. A quote calculated per square meter is always indicative, never definitive, because two walls with the same area may be in very different conditions, one with cracks or degraded plaster, another perfectly smooth. The final value can only be confirmed after assessing the actual condition of surfaces, whether through photos and videos or a site visit, and that is why our platform always requests photos and videos of surfaces before closing any quote, precisely to avoid surprises during work.

Beyond the tax treatment, there are other practical points to check before proceeding:

1. Confirm whether or not the property is in an ARU, by consulting the municipal authority.
2. Request that the professional view the space, through photos and videos or a visit, before finalizing the price.
3. Verify that the professional is properly registered as self-employed or that the company is legally established. Our platform always performs this check before presenting any professional as an option.
4. Ensure that the agreed scope is recorded in writing. On our platform, all work details are online, visible to the client, the professional, and the platform.

For those seeking facade painting3 in historic zones, it is worth checking the ARU classification before requesting quotes, as it can significantly change the final amount. The same care applies to building painting4 work in condominiums located in old urban centers.