IRS deductions in Portugal 2026: everything you can claim
IRS tax credits (deduções à coleta) come straight off your tax bill: each euro of deduction is one euro less IRS. Here are the main ones, with rates and caps for 2026 income.
How they work
The AT first works out your tax by applying the rates to your taxable income, then subtracts the deductions. Most come from invoices with your NIF reported to e-Fatura; others depend on your personal situation. Deductions can bring your tax down to zero, never below.
Summary (2026 income)
| Deduction | Rate | Cap |
|---|---|---|
| General household expenses | 35% | €250 per taxpayer |
| Health | 15% | €1,000 per household |
| Education | 30% | €800 per household |
| Rent on your permanent home | 15% | €900 (higher in some cases) |
| Care homes | 25% | €403.75 |
| VAT on invoices in certain sectors | 15% of VAT (100% on transport passes) | €250 per household |
| PPR (retirement savings plan) | 20% | €400 / €350 / €300 by age |
| Dependants | fixed | €600 / €726 / €900 |
| Dependent parents | fixed | €525 (€635 if only one) |
The main ones
- General expenses: almost any purchase with your NIF (groceries, fuel, utilities). 35% up to €250 per taxpayer — reached with about €715 of invoices. Single parents: 45% up to €335.
- Health: VAT-exempt or reduced-rate items count directly; items with 23% VAT need a prescription.
- Education: tuition, nurseries, school meals, books. The cap can rise to €1,100 with rent for students studying away from home.
- Rent: €900 cap for 2026 income; it can be higher for lower-income households and is at least €1,000 if you moved to an inland (interior) area. The lease must be registered and receipts electronic. Mortgage interest only counts for loans taken out by 31 December 2011.
- VAT: 15% of the VAT paid at restaurants and hotels, hairdressers, car and motorbike repairs and vets, plus 100% of the VAT on public transport passes.
- PPR: 20% of contributions, capped at €400 under 35, €350 from 35 to 50 and €300 over 50.
- Dependants: €600 each; €726 up to age 3; €900 for the second and later dependants up to age 6. Shared custody: half each.
- Disability (60% or more): 4 × IAS per taxpayer (€2,148.52 in 2026) and 2.5 × IAS per dependant or parent (€1,342.83), plus some expenses.
The overall cap (art. 78(7))
Health, education, rent, mortgage interest, care homes, VAT, alimony and tax benefits such as PPR and donations share a combined ceiling: no cap if taxable income is within the first bracket (€8,342 in 2026); from there it falls gradually from €2,500 to €1,000 at €80,000; €1,000 above that; plus 5% per dependant for families with three or more. Dependants, parents, general expenses and disability sit outside it.
Example
Single, 30, earning €1,500 × 14 (taxable income about €16,413, overall cap about €2,331): €5,000 general expenses → €250; €800 health → €120; €7,200 rent → €900 (cap); €40 VAT; €1,000 in a PPR → €200. Total: €1,510 less IRS. See how that becomes a refund in the IRS refund guide.
Don't forget e-Fatura
Validate pending invoices on e-Fatura by the end of February and pick the right sector, for yourself and each dependant. From 16 to 31 March you can check the amounts and dispute general expenses and VAT; other deductions can be corrected in Annex H — which means filing manually instead of using IRS Automático. Under 35? Check the IRS Jovem guide.