Corporation Tax (“IRC”)

The Basics

What are the IRC rates?

Type of Income Rates
Resident and non-resident companies with permanent establishment in Portugal* up to 12.500 12,5%
Above 12.500 25%
Non-resident companies without permanent establishment in Portugal (e.g. Offshore company)**
25%
Non-legal persons without permanent in Portuguese territory (e.g. charity associations)
20%
*Surcharge (“derrama”) of 1,5% on the taxable profit, resulting in a maximum combined rate of 26,5%
**See Withholding tax rates on “Non-residents companies” section

What rates are applicable?

Type of Income Rates
Rental Income 15%
Capital Gains 25%

Definitive withholding tax would be applicable in the following situations:

Type of Income Rates
Dividends and income from nominative or bearer securities and the liquidation proceeds attributed to shareholders 21,5%
Dividends distributed to entities resident in an European Union Member State 0-21,5%
Royalties/technical assistance and equipment rentals 15%
Income from bonds and other financial investments 21,5%
Interest and royalty payments between associated companies (4), where the beneficial owner is a company of another Member State or a permanent establishment situated in another Member State of a company of a Member State (Directive n.º 2003/49/EC) 0-21,5%
Prizes from raffles, sweepstakes, lotto, games and contests 35%

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