How to file an IRS tax return in Portugal in 2026: deadlines, rates and foreign income

Who must file IRS in Portugal

Before becoming a tax resident of Portugal, you should know the following:

• residents must declare all their income — both Portuguese and foreign;
• if a person is not a resident, only Portuguese-source income is declared to the Autoridade Tributária.

We remind you that tax residency status is determined by criteria such as spending 183+ days in the country, having housing, NHR status, temporary protection, etc.

If you moved from another country, you should check whether two countries may consider you a tax resident at the same time.

The risks of dual residency in Portugal include increased attention from the Autoridade Tributária and additional tax obligations. Therefore, it is worth reviewing the issue of double taxation in advance:
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If a person became a tax resident of Portugal not from the beginning of the year but during the year, the tax return must separately determine which income is subject to declaration in Portugal. When moving to Portugal, taxes for 2025–2026 depend not only on the type of income but also on the moment residency was obtained. This factor determines whether income is declared for the whole year or only for the relevant period.

IRS calendar for 2026

For most individuals, the filing season includes two key dates when you need to use the AT Portal das Finanças.

By March 2, 2026, the preparatory stage must be completed. This includes checking and updating family information, submitting proof of education, and reviewing expenses in the e-fatura system. The final deadline to verify e-fatura in Portugal in 2026 falls on March 2 because the end of February coincides with a weekend.

From April 1 to June 30, 2026, the main filing period for the IRS return for 2025 income takes place. During this period, Modelo 3, the main annual tax return, must be submitted. For most taxpayers, this timeframe is the main IRS filing deadline in Portugal in 2026.

Difference between NHR and IFICI

It does not matter how you obtained Portuguese tax residency (183 days of stay, having a home, or the center of vital interests). Once you acquire resident status, either the general tax regime or a special regime (NHR or IFICI) may apply depending on the date, conditions, and your profile.

NHR – the previous special tax regime, which is no longer open to new applicants under the standard procedure but continues to apply to those who already held this status or fell under transitional rules.

Under this regime, a 20% rate applied to certain employment or business income, and some foreign passive income could be exempt from taxation in Portugal if the regime conditions and international agreement provisions were met. At the same time, foreign capital gains under NHR did not receive a separate exemption and, as a general rule, were taxed according to standard rules.

You can read more about the conditions and advantages of this regime in the article: Taxes in Portugal and strategies for their optimization.

IFICI – a new regime for those who become tax residents and meet the established conditions. It also provides a 20% rate, but only for certain employment or business income. The approach to foreign income under IFICI is broader than under classic NHR, potentially including foreign capital gains, though there are restrictions on pensions.

The main difference between NHR and IFICI lies not so much in the rates or categories eligible for exemption, but in access to the regime. NHR was previously much broader, available to new Portuguese tax residents who had not been residents in the previous five years and submitted their application on time. IFICI, in contrast, is available only to specific legally defined categories of persons and types of activities. Therefore, while the tax outcome may be similar in practice, the pool of those who can actually enter the regime under IFICI is much narrower.

For more details on obtaining IFICI status and its benefits, including for declaring foreign income in the 2026 IRS in Portugal, see our other materials:

• How to obtain IFICI (NHR 2.0) status in Portugal
• NHR 2.0 instead of NHR: how the new IFICI regime works in Portugal

When foreign income may be exempt from taxation in Portugal

In our cases, there were situations where taxpayers paid 0% tax on foreign income. However, such a result does not occur automatically. It is possible only when several conditions are met simultaneously.

Most often, it involved a combination of the following factors:

• the person had NHR status;
• the income belonged to types of foreign income for which the regime allowed exemption in Portugal;
• in some cases, this applied not only to passive income but also to income from work or business activities, if the person fell under the list of high value-added professions;
• there was a real connection of the income with another country;
• there was a double taxation agreement between Portugal and the country of source;
• if required, the source country had either already levied a tax or had the right to do so.

It is important not to oversimplify. Having NHR status alone does not mean that any foreign income will automatically result in zero taxation in Portugal. Everything depends on the type of income, the country of origin, the nature of the payment, and whether the conditions for exemption are actually met in the specific situation.

One practical point to keep in mind: exemption from foreign income does not always mean that this income has no impact on the overall tax calculation in Portugal. In some cases, the income may not be taxed separately but is still taken into account for the overall calculation. Therefore, in each case, it is necessary to check not only the fact of the exemption but also how this income is reflected in the tax return.

IRS rates for 2025 income

For the tax return submitted in 2026, the IRS rates for Portugal in 2025 are relevant.

The scale was as follows:

To calculate expenses in a specific case, you can use an IRS calculator for Portugal 2025.

However, it is important not to make a common mistake. Being in a higher bracket does not mean that the entire income is taxed at that rate. For the 2025 IRS declaration in Portugal, a progressive scale applies: different portions of income are taxed at different rates. Therefore, the effective tax rate on total income is usually lower than the maximum rate of the highest bracket.

Why the 20% rate is not always more advantageous

Having a special tax status does not automatically mean that the 20% rate will be the most beneficial. In practice, it depends on the amount of income, its structure, and the rules applied to the specific case.

For this reason, in some cases it is advisable to calculate the tax both under the special regime and under the general progressive scale. For lower or medium incomes, the general regime can sometimes yield results that are as good as or even better. At the same time, for higher incomes, the fixed 20% rate is often more advantageous.

There is no universal rule here — each case needs to be calculated individually.

Solidarity tax

For incomes over €80,000 in Portugal, an additional tax applies — the solidarity tax.

Its rates are as follows:

• 2.5% on income from €80,000 to €250,000
• 5% on income over €250,000

Therefore, for higher incomes, it is important to consider not only the main IRS scale but also the overall final tax result.

Checklist: What to check before submitting IRS in Portugal 2026

You can use this checklist from the Barbashyn Law Firm team to review the main preparation aspects and submission steps for the 2026 IRS in Portugal.

Determining your status

• Current status – resident / non-resident
• Whether double residency may occur
• If relocation happened during 2025 – exact date of acquiring residency
• Which tax regime applies – general, NHR, or IFICI
• Verification of validity of NHR status or obtaining IFICI

Foreign income

• Have supporting documents for each type of foreign income (salary, dividends, royalties, rent, capital gains)
• Check if there is a double taxation agreement between Portugal and the source country
• Determine if there is a right to exemption or credit for foreign tax paid

Preparatory stage (by 2 March 2026)

• Verify and update family data on AT Portal das Finanças
• Check expenses in the e-fatura system and correct any errors
• If applicable – submit proof of education
• Collect receipts and documents that are not automatically reflected in e-fatura

Calculation and choice of regime

• Calculate tax under the general progressive IRS 2025 scale
• If eligible for NHR or IFICI – calculate the 20% rate option and compare with the general regime
• Check if Portugal’s solidarity tax (for income €80,000 and above) is included

Completing and submitting Modelo 3 (by 30 June 2026)

• Fill in the main form and annexes
• Report foreign income in the correct category
• Submit the declaration and save the confirmation

Conclusion

For the IRS in Portugal in 2026, the most important thing is not to start with the form until you understand what the numbers actually represent. First, determine your residency status, then categorize your income, next check whether the general regime, NHR, IFICI, or foreign tax credit applies. Only after that should you proceed to the actual declaration.

In short, the key points for submitting the IRS declaration in 2026 are:

• By 2 March – complete preparatory actions (review and update data, including e-fatura).
• By 30 June – submit Modelo 3, having reviewed examples of how to fill it out in Portugal 2026.
• For 2025 income, use the 2025 IRS scale.
• For income above €80,000, don’t forget the solidarity tax.

Disclaimer: This material is for informational purposes only and does not constitute individual tax or legal advice. If you need analysis of your specific situation, selection of the optimal tax regime, or assistance with preparing the IRS declaration in Portugal, contact the Barbashyn Law Firm team.