Tax benefits contract signed with the State, with a validity period of up to 10 years counted from the conclusion of the investment project, for investment projects equal or exceeding € 3,000,000.00.
The benefit consists of a tax credit*, ranging between 10% and 25%** of the relevant applications of the investment project realized to be deducted from the amount of the Corporate Income Tax (IRC) due.
Exemption or reduction of IMI (during the term of the contract), IMT and IS, regarding buildings, acts or contracts necessary and/or used within the scope of the relevant investments.
The relevant applications are expenses in tangible fixed assets associated to the investment projects except:
The benefit consists of a tax credit*, ranging between 10% and 25%** of the relevant applications of the investment project realized to be deducted from the amount of the Corporate Income Tax (IRC) due.
Exemption or reduction of IMI (during the term of the contract), IMT and IS, regarding buildings, acts or contracts necessary and/or used within the scope of the relevant investments.
The relevant applications are expenses in tangible fixed assets associated to the investment projects except:
- Land, except for the extractive industry meant for the exploration and concession of minerals, table and medical waters, quarries, barriers and sand pits;
- Buildings and other constructions not directly linked to the production process or the essential administrative activities;
- Light passenger or mixed use vehicles;
- Other transport equipment whose value exceeds 20% of the total amount of the relevant applications;
- Furniture and comfort or decoration items, except hotel equipment used to tourist exploitation;
- Social equipments;
- Other investment assets, which are not assigned to the productive activity of the company, except for the productive equipments for the use, for economic purposes, of waste resulting from the productive transformation or consumption in Portugal, as long as of recognised industrial and environmental interest;
- Technology transfer expenses, namely through the acquisition of patent rights, licences, know-how or technical skills not protected by patents (in the case of large enterprises these investments may not exceed 50% of the relevant applications);
- Advanced payments related to the project, if made less than one year before the submission of application to the contractual benefits, up to the amount of 50% of the cost of each acquisition; and expenses with studies related to the project, registered as intangible assets.
* The tax credit foreseen has the following limits (i) in the case of company start-ups, the annual deduction may correspond to the total amount of the tax due ascertained in each tax year; and in the case of projects in existing companies, the maximum annual deduction may not exceed the highest value between 25% of the total tax benefit granted or 50% of the tax due ascertained in each tax year.
** The base percentage is 10%, which may be increased by up to 25%, depending on (i) the location of the project; and/or (ii) the creation of new jobs or the maintenance until the term of the contract; and/or (iii) if the project is of recognised exceptional importance to the national economy - for further details, see Article 9 of the Investment Tax Code.
Requirements
Project promoters conditions:
- Have technical and management capacity;
- Demonstrate a balanced financial situation with a financial autonomy of 20% or more, and finance the project through their own resources or through external financing corresponding to at least 25% of the projects’ eligible costs;
- Have duly organized accounting and their taxable profit not determined through indirect methods;
- Not be subject to an outstanding recovery order following a previous Commission Decision declaring the aid illegal and incompatible with the common market;
- Have tax payments and social security contributions regularized;
Project conditions:
The projects must be in the initial investment phase; the realization must not have started before the application, and must demonstrate to be technically, economically and financially viable, provide job creation or maintenance, and also fulfil at least one of the following requirements:
- Being relevant for the strategic development of the national economy;
- Being relevant for the reduction of regional asymmetries;
Finally, the incentive effect of the tax benefits must be demonstrated by completing Annex III of the form that forms part of the application process for tax benefits, as set out in Ministerial Order 94/2015, of 27 March.
Sectors of activity covered:
- Extractive industry - divisions 05 to 09;
- Manufacturing industry - divisions 10 to 33;
- Hospitality - division 55;
- Catering and similar - division 56;
- Editing activities - division 58;
- Film, video and television program production activities - group 591;
- Consulting and computer programming and related activities - division 62;
- Data processing activities, information hosting and related activities and web portals - group 631;
- Scientific research and development activities - division 72;
- Activities of interest to tourism - subclasses 77210, 90040, 91041, 91042, 93110, 93210, 93292, 93293, 96040;
- Administrative and support service activities provided to companies - classes 82110, 82910.
How to obtain
To be eligible for the benefit, investment project promoters must submit their application file, duly characterised and justified, to the following entities:
- Portuguese Business Development Agency (AICEP), when the investment projects fall under the contractual investment regime foreseen in Decree-Law 203/2003, of 10 September;
- Institute for Support of Small and Medium-sized Enterprises and Innovation (IAPMEI), for the remaining cases.