Portugal

Portugal is a democratic republic on the Iberian Peninsula in Europe. Its capital city is Lisbon, with the euro (EUR) as its currency and Portuguese as the official language. 

An earthquake in Lisbon in 1755 destroyed much of the city. As a result of this, the Napoleonic occupation (from 1807), and the independence of Brazil in 1822, Portugal lost much of the wealth and status it had previously enjoyed. 

Portugal joined the European Union (EU) in 1986 and is a founding member of the North Atlantic Treaty Organization (NATO). Since joining the EU, the Portuguese economy has become more service-based and diversified. 

Many state-controlled organisations have been privatised over the past 20 years, and key areas of the economy – namely the financial and telecommunications sectors – have been freed up.

Gross domestic product was -7.6% in 2020, but is expected to reach 4.8% in 2022. The country has made a strong recovery from the effects of the Covid-19 pandemic with a vaccination rate of close to 90%. 

Our local Tax Natives in Portugal can tell you everything you need to know about the ins and outs of your tax obligations there. Whether you’re buying a single property, or doing complex business deals, we’ll get you the advice you need. Just say the word and we’ll link you with a local expert who can answer all your questions. 

THE HEADLINES

• The corporate income tax rate in Portugal is 21%
• In Portugal the headline personal income tax rate is 48% plus 2.5% in solidarity surtax on taxable income exceeding 80,000 EUR. And there’s a 5% additional rate applicable on taxable income above 250,000 EUR
• The standard VAT rate is 23%