How it works
Annual gross income is the monthly salary × 14 (Portuguese employees receive holiday and Christmas allowances). Employees pay 11% social security with no cap. For IRS, the specific deduction of €4,587.09 (or social security, if higher) is subtracted, plus a "minimum subsistence" allowance for low incomes (reference value €12,880). The 2026 progressive rates — reduced by Decree-Law 212/2026 with effect from 1 January — are applied to taxable income, then €250 of general family expenses and €600 per dependent are credited. A solidarity surcharge applies above €80,000.
2026 IRS rates
| Taxable income | Rate |
|---|---|
| €0 – €8,342 | 12.2% |
| €8,342 – €12,587 | 15.2% |
| €12,587 – €17,838 | 20.7% |
| €17,838 – €23,089 | 23.6% |
| €23,089 – €29,397 | 30.6% |
| €29,397 – €43,090 | 34.6% |
| €43,090 – €46,566 | 43.1% |
| €46,566 – €86,634 | 44.6% |
| Over €86,634 | 48% |
Examples
At €1,500 a month (14 payments): social security €2,310.00, IRS €2,204.93, net pay €16,485.07 a year or €1,177.51 per payment. At €1,000 a month, IRS is just €491.90; at the €920 minimum wage it is zero.
Limitations
Health, education and housing deductions, joint taxation, the IRS Jovem regime, NHR/IFICI and the Azores/Madeira rates are not included. The result is the final annual tax, not monthly withholding.
Frequently asked questions
What are the IRS rates in Portugal for 2026?
From 12.2% (up to €8,342) to 48% (above €86,634), after Decree-Law 212/2026 cut the first six bands.
Do minimum-wage earners pay income tax in Portugal?
No. €920 × 14 = €12,880 a year falls within the minimum subsistence threshold, so IRS is zero.
How much social security do employees pay?
11% of gross salary, including holiday and Christmas allowances.
- Decreto-Lei n.º 212/2026, de 4 de novembro — taxas do artigo 68.º do CIRS para 2026 (Diário da República)
- Código do IRS, artigo 70.º — mínimo de existência (valor de referência 12 880 €)
- Autoridade Tributária — Sistema Fiscal Português: taxas aplicáveis 2026
- AT — Newsletter n.º 39 (janeiro 2026): IAS 537,13 € e dedução específica 4 587,09 €
- Segurança Social — taxa contributiva do trabalhador por conta de outrem (11%)