Taxes and Social Security

Taxes and Social Security

IRS is levied on income obtained by individuals, taxation being dependent on their tax status and income being divided into 6 different categories.

Workers also pay for Social Security


Residents: Are taxed for all income obtained (in Portugal and abroad)

Former residents: Exclusion from taxation of 50% of income from employment and business and professional income

Non-habitual residents: Are taxed on net income from employment and independent work at a flat rate of 20% on income from "high added value" activities. Foreign source income may be exempt from taxation under certain circumstances

Non-residents: Are taxed on income obtained in Portugal

Category A: Income from employment

Category B: Business and professional income

Category E: Capital Income

Category F: Property income

Category G: Asset Enhancements

Category H: Pensions

See Here the IRS Retention Tables

Social Security is a system that aims to ensure citizens' basic rights and equal opportunities, as well as to promote well-being and social cohesion for all Portuguese or foreign citizens who exercise professional activity or reside in the territory.



Independent Workers