Tax Incentives

Companies can benefit from tax incentives for productive investment:
  • Special Tax Regime to Support Investment ("RFAI”)
  • Tax Incentives Scheme for Business Research and Development ("SIFIDE II”)
  • Tax Benefits for the Reinvestment of Retained Earnings ("DLRR”)
  • Contractual Tax Benefits System for Productive Investment
In general, these tax benefits schemes are characterized by the reduction or exemption of payment of taxes, such as Property Tax (IMI), Property Transfer Tax (IMT) and Stamp Duty, as well as the reduction of the Corporate Income Tax (IRC). They have been reinforced and have even more favourable conditions, in the particular case of those investments addressing the creation or maintenance of jobs and which are located in less-favoured regions, like the Northern Region.

In addition to these, there also exist the Non-Habitual Resident Tax Regime for Foreign Citizens


Special Tax Regime to Support Investment (RFAI)
The special investment support scheme is a tax benefit approved by the Decree-Law No. 162/2014 of 31 October, which entitles companies to deduct a share of the investment performed in non-current assets (tangible and intangible) from the taxable income assessed.

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Tax Incentives Scheme for Business Research and Development (Sifide II)
The Tax Incentives Scheme for Business Research and Development II, in force from 2013 to 2020, aims to support the activities of Research and Development related to the creation or improvement of a product, a process, a program or an equipment which present a substantial improvement and that do not result only from a simple use of the current state of existing techniques.

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Tax Benefits for the Reinvestment of Retained Earnings (DLRR)
The reinvestment of retained earnings is a tax incentive to micro, small and medium-sized companies that allows IRC deduction of the retained and reinvested earnings used for the acquisition of relevant applications.

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Contractual Tax Benefits for Productive Investment
Tax aid regime on a contractual basis, with a duration of up to 10 years from the end of the investment project, for projects whose relevant applications are greater than or equal to EUR 3.000.000.

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Non-Habitual Resident Tax Regime For Foreign Citizens
The Non-Habitual Resident Tax Regime for Foreign Citizens is a measure implemented by the Portuguese State with the aim of attracting foreign individuals and investments, providing opportunities to live and travel in a space of security.

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The regime applies to individuals who become Portuguese tax residents under Portuguese domestic law in a certain year and have not qualified as tax residents in Portugal in any of the previous five years. 

For more information go to: http://info.portaldasfinancas.gov.pt/NR/rdonlyres/D0C80C76-3DA8-4B90-A1E4-FF53BD34EF95/0/IRS_RNH_EN.pdf
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