Tax planning is a strategy used by many millionaires that allows you to reduce the tax burden through the use of mechanisms provided for by law. According to the company CRN Accounting, it consists of a detailed analysis of the financial and tax situation of a person or company to identify legal solutions that avoid unnecessary charges. In Portugal, the main taxes in force are levied on income, consumption and heritage, encompassing, among others, the IRS, IRC, IMT, VAT, IUC, IS and ISV.
IMI is paid annually by real estate owners, reversing revenue to the city councils. According to Caixa Geral de Depósitos, there are situations where the law provides for permanent exemptions, such as in the case of real estate with tax assets (VPT) less than 71,296.40 euros that are their own and permanent household housing, provided that annual income do not exceed 16,398.17 euros.
There are also temporary exemptions, lasting three years, applicable to properties with VPT up to 125 thousand euros, acquired for their own and permanent housing, as well as buildings for the lease support program. Writes the bank that some additional situations, such as families with dependents, garages, stasks or land for construction, can also benefit from exemption.
Tax on costume transmissions of real estate (IMT)
IMT applies to real estate transactions, whether new or used, and must be paid by the buyer. The publication adds that the most housing program, in force since October 2023, has introduced changes to the regime, maintaining the possibility of exemption to taxpayers without tax or social security.
The law determines that the application for exemption must be made before the purchase contract signs and always before the tax payment, with the competent authority.
In turn, the IRS focuses on taxpayers’ income, running progressively. It refers to the same source that those who increase yields below the minimum of existence, set at 11,480 euros in 2024, is exempt from this tax. In addition, young people who start professional activity can benefit from Youth IRS, which gives a discount over five years.
In the case of companies, the IRC focuses on all income generated in Portugal, although exemptions are provided for certain entities and institutions, depending on the nature of their activity.
IVA, IUC and ISV
The VAT applies to the general business transactions, but the code provides exemptions under certain conditions, linked to the volume of billing, the purchase value or the area of activity. Explains Caixa Geral de Depósitos that some liberal professions and small businesses can benefit from this frame.
The IUC focuses on vehicles, recess boats and aircraft. According to the same source, there are automatic exemptions, such as electric vehicles, and others that depend on formal request, as in the case of persons with a disability of 60%or more.
The ISV, due at the time of vehicle enrollment, includes reductions for large families, people with disabilities, electric or low emissions vehicles, among other situations.
Impost of Slo (IS)
Finally, the IS covers a wide set of acts and contracts, but there are exceptions. According to, there are, for example, stock market operations on securities, guarantees provided to the State, interest on loans for their own housing or transmissions of goods between spouses, ascendants and descendants.
These measures allow private taxpayers and companies, through adequate tax planning, to be able to legally reduce the weight of income, consumption and heritage.
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