Portugal: corporate tax guide

What the tax system covers

A company resident through its seat or effective management is generally subject to Portuguese tax on worldwide profits. Foreign-company attribution, participation relief and foreign-establishment rules require distinct tests.

When a company becomes tax resident

Article 2 treats an entity as resident where its registered seat or effective management is in Portugal. These are alternative connections. An overseas incorporation therefore does not settle residence if substantive strategic management occurs in Portugal; a nonresident enterprise may instead be taxed on a Portuguese permanent establishment or other covered local income.

Rates and the tax base

19% ordinary mainland IRC rate for periods beginning in 2026. Municipal and state surtaxes, regional rates and qualifying small-business rules are separate. A foreign-income comparison must include them where relevant.

Outbound dividends, interest and royalties

Dividends: 25%; 35% specified blacklisted cases. Ordinary domestic rate for a nonresident entity without an attributable Portuguese permanent establishment. Article 87 raises covered capital-income payments to 35% for specified listed jurisdictions or unidentified beneficiaries. Domestic participation/directive exemptions and treaty relief are separate.

Interest: 25%; 35% specified blacklisted cases. Ordinary domestic rate for a nonresident entity without an attributable Portuguese permanent establishment. Article 87 raises covered capital-income payments to 35% for specified listed jurisdictions or unidentified beneficiaries. Domestic participation/directive exemptions and treaty relief are separate.

Royalties: 25%; 35% specified blacklisted cases. Ordinary domestic rate for a nonresident entity without an attributable Portuguese permanent establishment. Article 87 raises covered capital-income payments to 35% for specified listed jurisdictions or unidentified beneficiaries. Domestic participation/directive exemptions and treaty relief are separate.

CFC attribution can affect individuals and companies

Portugal’s corporate Article 66 and personal Article 20 both matter for international owners. The personal rule can reach direct or indirect holdings or rights of at least 25%, including fiduciary or intermediary arrangements. The corporate low-tax test includes a listed preferential jurisdiction or actual foreign profits tax below half the corresponding Portuguese liability. Attribution may arise without a dividend being paid.

Exceptions require analysis of the income mix or qualifying genuine activity, rather than merely a foreign address. Article 66 contains an exclusion linked to specified passive or low-value categories not exceeding 25% of total income and a separate EU/qualifying EEA genuine-economic-activity provision. Keep accounts, the ownership chain and the comparative tax calculation. A foreign company may also become Portuguese resident through its seat or effective management, which is a different question from CFC attribution and can change the entire corporate filing position.

Company migration follows a separate market-value calculation

Article 83 addresses a company transferring residence out of Portugal, bringing relevant differences between market and tax values into the closing taxable result. Assets remaining effectively connected to a Portuguese permanent establishment can fall under different treatment. The shareholder’s move does not necessarily cause this corporate event, but moving effective management can make it relevant.

For qualifying EU or EEA destinations with the required recovery-assistance framework, the law provides a five-instalment payment option, subject to interest and conditions. This is a payment mechanism, not an exemption; later transfers, disposals, nonpayment or liquidation can accelerate remaining amounts. Prepare the asset register, valuations, destination analysis and election before filing. Distinguish the company’s liability from the individual’s share-related or crypto departure rules.

Foreign companies and income attribution

Corporate Article 66 and personal Article 20 can attribute qualifying low-tax foreign-entity income. Relevant personal ownership or rights start at 25%, subject to statutory conditions and exceptions.

Departure, migration and continuing obligations

Corporate Article 83 covers loss of taxing rights; personal Article 10-A addresses specified deferred gains. Article 10 also contains a crypto departure deemed-disposal rule, with classification and statutory exclusions requiring review. This is not a general private-portfolio exit tax.