Corporate Vehicles

Corporate Vehicles

Lease Income

Lease income generated by a Portuguese company forms part of the taxable profits and is subject to Corporate Income Tax at a rate of 21%.

In addition to the Corporate Income Tax, there is also a municipal surtax ranging between 0% and 1.5% on the annual taxable profit (applicable before tax loss deduction).

Moreover, for taxable profits exceeding certain values, there is still a state surcharge:

  • 3% for taxable profits exceeding €1,500,000 and up to €7,500,000;
  • 5% for taxable profits exceeding €7,500,000 up to € 35,000,000;
  • 9% for taxable profits exceeding € 35,000,000.

All expenses relating to the lease activity – i.e. not only maintenance and repair expenses and Municipal Property Tax, but also depreciation charges plus financial costs – are generally tax deductible with certain limitations (please refer to “real estate financing” section).

Portuguese permanent establishments and companies are entitled to certain tax credits, and to carry forward tax losses (currently through a period of 5 years but limited to 70% of the annual taxable profits for losses originated).

It is expressly foreseen that there cannot be any kind of deductions to the total amount of autonomous taxation, even if those deductions are foreseen in special legislation. Autonomous taxation applies at different rates on certain expenses incurred by entities subject to Corporate Income Tax (such as, for example non-documented expenses, at a 50% tax rate; representation expenses, at a 10% tax rate and expenses incurred with vehicles, at taxes rates ranging from 10% to 35%). It is self-assessed in addition to Corporate Income Tax (even if no Corporate Income Tax is due), at variable rates.

Capital Gains

Capital gains realized upon the sale of property by a Portuguese resident company are subject to Corporate Income Tax at a rate of 21% (plus the aforementioned surtaxes, where applicable).

Upon the sale of the Portuguese SPV, capital gains realized by the non-resident investor (shareholder) are subject to income tax (Personal Income Tax or Corporate Income Tax depending on the investor being a natural or legal person). Such capital gains will be subject to Corporate Income Tax at a rate of 25% (or to Personal Income Tax at a rate of 28%). The taxation of the capital gains may be eliminated pursuant to a domestic exemption foreseen in the Tax Benefits Code or pursuant to a double tax treaty, subject to certain conditions and formalities. However, provided that more than 50% of the Portuguese SPV’s assets are real estate properties located in Portugal, the domestic exemption and the majority of the double tax treaties executed by Portugal foresee that the capital gains remain taxable in Portugal.


Dividends distributed by a Portuguese SPV to the respective shareholder(s) are generally subject to income tax. Nonetheless, pursuant to the “participation exemption” regime, a Corporate Income Tax exemption is granted provided certain requirements are complied with. The main requirements are the following:

  • The recipient of the dividend distributions holds at least 10% of the share capital or voting rights over the Portuguese SPV;
  • The said shareholding was held for at least 1 year prior to the dividend distribution;
  • The shareholder is a company resident in Portugal, in another EU or EEA member state, or a third country with a double tax treaty in force with Portugal and is subject to Corporate Income Tax at a rate higher than 60% of the Portuguese Corporate Income Tax rate (i.e. 12.6%).

Collective Investment Undertakings

Collective Investment Undertakings are subject to Corporate Income Tax at the general corporate tax rate (currently set at 21%). No municipal tax or state surtax will apply.

The taxable income of Collective Investment Undertakings corresponds to the net profit assessed in accordance with their respective accounting standards. However, investment income, rents and capital gains (except when sourced in a blacklisted jurisdiction) are disregarded for profit assessment purposes. As a consequence, expenditure related to the disregarded income is also not tax deductible against the taxable profit of the Collective Investment Undertakings.

Collective Investment Undertakings are also subject to Stamp Duty on a quarterly basis. Stamp Duty is levied at a rate of 0.0125% on the Collective Investment Undertakings’ net asset value.

At the investor level, the distribution of profits and the capital gains derived from the sale of Collective Investment Undertakings is subject to withholding tax as follows:

  • resident individuals are subject to a 28% withholding tax rate;
  • resident companies are subject to a 25% withholding tax rate; 
  • non-resident individuals or companies are subject to a 10% withholding tax rate.


Since January 2019, the regime applicable to the Collective Investment Undertakings was also extended to SIGIs, with a particularity regarding capital gains deriving from the sale of properties. Capital gains deriving from the sale of properties may only be disregarded for profit assessment purposes when such properties have been used for rental purposes or other forms of services necessary for the properties’ use for at least three years.

Please note, however, that the application of such regime depends on the compliance of the SIGI with the formal requirements described above in order to qualify as a SIGI from a legal and regulatory standpoint.