Tax and accounting in Portugal: the 2026 figures and who does what

Who pays what: the three questions

Every tax file in Portugal starts with the same three questions, and the answers decide everything below.

Are you tax resident? You are, for a given year, if you spend more than 183 days in Portugal in any twelve-month period starting or ending in that year, or if — with fewer days — you have a home here on any day of that period in conditions that show you intend to keep it as your habitual residence (IRS Code, art. 16.º). A day counts if you sleep here. Residence starts on the first day of the stay and, unless you were resident the year before, the year is split: non-resident until arrival, resident after.

Where does the income come from? Residents declare worldwide income; non-residents only Portuguese-source income, mostly through final withholding at 25 % (work, pensions, business income) or 28 % (capital income). A treaty can cut those rates or send the income back to your home country.

What did you buy? Property is taxed at purchase (IMT and stamp duty), every year (IMI, and AIMI above 600 000 €) and at sale (capital gains). No tax applies to holding cash, shares or funds as such.

• 12,5 % to 48 % — the nine IRS brackets on 2026 income
• 28 % flat rate on interest, dividends and capital gains; 25 % on residential rents (15 %, 10 % or 5 % for leases of 5, 10 or 20 years)
• 19 % IRC on company profit in 2026 (15 % on the first 50 000 € for SMEs), 18 % in 2027, 17 % from 2028
• 6 / 13 / 23 % IVA on the mainland

Personal income tax (IRS): the 2026 brackets

The table of article 68.º, as amended by the 2026 State Budget (Lei n.º 73-A/2025), applies to income earned in 2026 and declared in spring 2027:

The rates are marginal: each slice is taxed at its own rate. Salaries and pensions first lose a fixed deduction of 8,54 × IAS = 4 587 € (or the social contributions actually paid, if higher); a couple may file jointly and split the income in two before applying the table. A solidarity surcharge of 2,5 % applies between 80 000 € and 250 000 € and 5 % above (art. 68.º-A).

Some income never enters the table unless you choose to add it: interest, dividends and gains on shares at 28 %; rents from a home let on a permanent lease at 25 %, falling to 15 % for leases of five to ten years, 10 % for ten to twenty, 5 % beyond twenty (art. 72.º). Gains on Portuguese or foreign property are added to the table at 50 % of the gain (art. 43.º); the gain on your main home is exempt when the proceeds are reinvested in another main home in the EU or EEA within 36 months (art. 10.º).

Foreign income is declared in the same return. Tax paid abroad is credited against the Portuguese tax on that income, within the limits of the treaty (art. 81.º). Where no treaty exists — Sweden and Finland denounced theirs, Australia and New Zealand never signed one — the credit is still granted, but capped at the Portuguese tax on the income.

Special regimes worth knowing before you move

• IFICI (Incentivo Fiscal à Investigação Científica e Inovação, art. 58.º-A EBF): a 20 % flat rate for ten years on employment and self-employment income from listed activities — university teaching and research, jobs in certified start-ups, highly qualified professions in exporting industrial or service companies, R&D staff, posts recognised by AICEP or IAPMEI — for people who were not tax resident in any of the previous five years. Foreign employment, business, capital, rental and gains income is exempt in Portugal (with progression). Registration by 15 January of the year after arrival. Anyone who ever held NHR is excluded. Details on the NHR and IFICI page.
• NHR closed to new entrants on 1 January 2024; existing beneficiaries keep their ten years.
• Returning residents (art. 12.º-A): Portuguese ex-residents who come back by 2026 after five years abroad exclude 50 % of their salary or business income for five years.
• Simplified regime for the self-employed: tax is computed on a fixed share of turnover (75 % for the listed professions, 35 % for other services and local lodging, 15 % for sales, restaurants and hotels) up to 200 000 € of annual revenue — no bookkeeping of expenses. Above that, or by choice, organised accounts with a certified accountant.

Companies: IRC, surcharges and VAT

The corporate rate falls one point a year: 19 % in 2026, 18 % in 2027, 17 % from 2028 (Lei n.º 64/2025). Small and medium companies pay 15 % on the first 50 000 € of taxable profit. Add the municipal surcharge (derrama municipal, up to 1,5 %, set by each council) and, above 1,5 million euros of profit, the state surcharge of 3 %, 5 % (above 7,5 million) and 9 % (above 35 million).

Dividends paid to a foreign shareholder carry 25 % withholding (28 % to an individual), reduced by treaty — the country pages list the rates — and to zero for EU parent companies holding 10 % for a year.

IVA is charged at 23 % (13 % on restaurant meals, wine, some foods; 6 % on essentials, medicines, books, hotels, electricity up to a threshold); Madeira applies 22/12/5 %, the Azores 16/9/4 %. Businesses below 15 000 € of annual turnover may stay outside VAT (art. 53.º). Returns are monthly above 650 000 € of turnover, otherwise quarterly.

Social security in 2026

New self-employed workers pay nothing during their first twelve months. Posted workers covered by an EU form A1, by the EU–UK protocol or by a bilateral agreement (Portugal has one with the United States, Canada, Brazil and a dozen other countries) keep paying at home for the period the certificate covers.

Property: buying, holding, selling

The full mechanics, with the 2026 tables and an example, are on the housing and real estate page.

The calendar

Portugal compared with your country

Each guide below sets the Portuguese rules against the tax system you are leaving — residence tests, income tax, pensions, capital gains, property, social security — and reads the double-tax treaty between the two countries article by article (rates from the Tax Authority’s 2026 treaty table).

Questions people ask first