The salary you will receive in August may come with a positive difference for your wallet. Changing the IRS general rates to the first eight echelons of income is now reflected in the salaries, with the new retention tables to be applied this month. But this tax relief may have consequences in the final tax settlement next year.
According to Lusa, companies and salary entities are required to apply new fees from 1 August, as defined in the order published by the government on July 22. The changes also apply to social security pensioners and the General Retirement Caixa (CGA), which will see the retention decrease over the next two months.
The new tables produce immediate effects, but there is flexibility for companies that cannot update the retention in a timely manner. According to the same order, these may make the hit later, until December 2025.
Two phases of rate change
Between August and September, the retention tables have exceptionally lower rates, with the purpose of compensating the retention made between January and July, when the final version of the rates was not yet approved. From October, the rates rise again, but will remain lower than those in force earlier this year.
According to the State Department of Tax Affairs, in August and September, those who have a gross salary up to 1,136 euros will be exempt from IRS. Above this value, until salaries of 1,574 euros, retention will be less than ten euros.
Possible impact on next year’s reimbursement
Simulations of the consultant indicate that, at the IRS of 2025, to be delivered by 2026, many taxpayers will be able to receive lower reimbursements. In some cases, those who usually pay tax in the final hit may have to deliver higher amounts.
This possibility led the Socialist Party to question the government about the sustainability of this temporary reduction in the retention and the impact on taxpayers. The PS recalls that in 2024, when there was a descent of IRS in the middle of the year, the then government of Luís Montenegro applied cuts in the retention they consider to have been “excessive”, creating a more significant descent perception than that verified in the final hit.
When he released the new tables, Secretary of State Claudia Reis Duarte told Lusa that the measure maintains the approximation trajectory between the taxed tax and the final value of the IRS. According to the ruler, “what may happen is that the final hit, in 2026, does not correspond to that of previous years because of adjustments in retaining, but this is positive because it means that people have money in their pockets earlier.”
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