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Tax Rates in Portugal for 2016, 2015, 2014

Income Tax Rate for Individual Tax Payers in 2015

 

Net Taxable Income EURO

 

Income Tax Rates

 

up to €7 000

 

14%

 

€7 000 to €20 000

 

28.5%

 

€20 000 to €40 000

 

37%

 

€40 000 to €80 000

 

45%

 

more than €80 000

 

48%

 

Lowest Individual Tax Rate in Portugal is 14.5% and Highest Rate is 48%

Tax Rate for Non-residents in Portgul for 2015

 

Income (Portuguese source)

    

Tax rate (percent)

 

Employment income

Business and professional income

Interest

Dividend

Capital gains on sale of shares Tax exempt or

Capital gains on sale of real estate

Rental income

Pension income

 

25

25

28

28

28*

28*

28*

25

 

Tax Rate for Non habitual residents in Portugal for 2015

 

Income (Portuguese source)

    

Tax rate (percent)

 

Employment income**

Business and professional income**

Interest Tax exempt or

Dividend Tax exempt or

Capital gains on sale of shares Tax exempt or

Capital gains on sale of real estate Tax exempt or at marginal rates

Rental income Tax exempt or

Pension income Tax exempt or at the marginal rates up to

 

20

20

28

28

28

48

28

48

 

Income Tax Rate for Individual Tax Payers in 2014

 

Net Taxable Income EURO

 

Income Tax Rates

 

up to €7 000

 

14%

 

€7 000 to €20 000

 

980+28.5%

 

€20 000 to €40 000

 

2630+37%

 

€40 000 to €80 000

 

5880+45%

 

more than €80 000

 

8280+48%

 

 

Tax Exempt Income

Meal allowance

Meal allowance up to EUR4.27 per day if paid in cash, or EUR6.83 if paid by lunch tickets.

Daily allowance for business travel

Daily allowance for business travel in Portugal up to EUR 50.20 [EUR 69.19 for Members of the Board] or up to EUR 89.35 [EUR 100.24 for Members of the Board] for business travel abroad.

Travel expenses

Documented travel expenses or allowance for business travel when reimbursed by the company (range between EUR0.11/kilometer up to EUR0.36/kilometer, depending on the mean of transportation (public or particular) and on the number of employees, if it is a rented vehicle).

Tax Rate for Non-residents in Portgul

 

Income (Portuguese source)

    

Tax rate (percent)

 

Employment income

Business and professional income

Interest

Dividend

Capital gains on sale of shares Tax exempt or

Capital gains on sale of real estate

Rental income

Pension income

 

25

25

28

28

28*

28*

28*

25

 

Tax Rate for Non habitual residents in Portugal

 

Income (Portuguese source)

    

Tax rate (percent)

 

Employment income**

Business and professional income**

Interest Tax exempt or

Dividend Tax exempt or

Capital gains on sale of shares Tax exempt or

Capital gains on sale of real estate Tax exempt or at marginal rates

Rental income Tax exempt or

Pension income Tax exempt or at the marginal rates up to

 

20

20

28

28

28

48

28

48


* Taxpayer is required to file a tax return.
** If derived from a “high-value-added” activity plus an additional 3,5% surcharge levied on the annual taxable income that exceeds the amount of the annual national minimum salary (EUR6,790).

Additional Solidarity Surcharge

An additional 2.5 percent surcharge will be levied on taxable income between EUR80,000 and EUR250,000 and 5 percent on the taxable income exceeding EUR250,000.

Additional surcharge

A 3.5 percent additional surcharge will be levied on the annual taxable income that exceeds the amount of the annual national minimum salary (EUR6,790).

For married taxpayers, the surcharges will be levied on the difference between taxable income divided by two (taxable income / 2) and EUR153.300,00. The resulting amount will then be multiplied

The above rates apply to individuals who derive income from business (including capital gains from the sale transfer or exchange of shares in a foreign corporation) or from the practice of a profession.

 

Individuals holding managerial and highly technical positions employed by RHQs, ROHQs, multinational companies and offshore business units are taxed at 15% on their gross income.

 

Income in Portugal is divided into the following three categories which are taxed separately, as summarized below.
1. Compensation employment income: This income is taxed at progressive rates on gross income after deduction of personal and additional exemptions but without deductions for expenses.
2. Passive income: This income, including dividends and interest, is subject to tax at 7.5%.
3. Business income and professional income: This income is taxed at progressive rates on net business income after deduction of certain specified expenses.

 

Corporate Tax Rates in Portugal

Statutory withholding tax rates are the following: Dividends 19%; Interest 20%; Royalties 20%.

Portugal Dates of filing Returns / Reporting and Payment

The tax year ends on 31 December in Portugal.

The Portuguese fiscal year for individuals is the calendar year and Portuguese residents are required to file an annual tax return between March and May each year, as per information provided previously.

Married taxpayers are required to file a joint tax return as long as one of the spouses is considered Portuguese resident for tax purposes.

If one spouse does not spend more than 183 days in relevant year in Portugal and proves that there is no connection between his/her economical activity and Portugal (as mentioned above), the resident spouse may file a tax return (only including his/her personal income received) as a separated individual.

Withholding tax levied on most income is deemed as payment on account of year-end’s tax liability and taken into consideration in the annual assessment. The final tax assessment has to be issued on the following deadlines:


up to 31 July, if the tax return is submitted:


from 1 March to 31 March, if the tax return is filed in paper and if only employment and/or pension was received or


from 1 April to 30 April, if the tax return is submitted through the Internet and if only employment and/or pension income was received.
up to 31 July, if the tax return is submitted:


from 1 April to 30 April, if the tax return is filed in paper and if other type of income was received or


from 1 May to 31 May of the following year, if the tax return is submitted through the Internet and if other type of income was received.


Non-resident

Non-resident taxpayers are only required to file tax returns when earning Portuguese-sourced income not subject to withholding tax at the applicable flat rates.

 
 

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