Withholding Tax - Retenção na Fonte in 2026

In 2026, payments of salaries and pensions shall be adapted to the new withholding tax calculations mechanism, aiming at applying adequate withholding tax rates in view of the taxpayer's situation.

The new withholding tax tables for the 2026 personal income tax (IRS) are published on the Tax Authority Website. The reduction in this tax, which has been in force since the beginning of January, will boost the incomes of workers and pensioners. Here are a few examples:

• An unmarried taxpayer, with no dependents and a salary of around €1,300, will withhold 9.23% of IRS tax every month–around €120 per month (i.e., around €1,440 per year)
• A taxpayer under the same conditions, but with a salary of around €2,000 per month, will withhold 15.07% of IRS tax– around €301 per month (i.e., €3,615 per year)
• A married taxpayer (single holder), with one dependent and a gross salary of €2,000 per month, will withhold 6.56% of IRS tax–around €131 per month (i.e., €1,574 per year).
• Married (two holders), with one dependent and a gross salary of €2,000 per month, will withhold 14% of IRS tax–around €280 per month (i.e., €3,358 per year).

Workers who receive the minimum wage, which has risen to €920, are exempt from paying IRS and do not have to pay withholding tax.