Portugal’s general corporate tax (IRC) rate drops from 19% to 18% in 2027, as set out in Law 64/2025 and confirmed in the 2027 State Budget proposal. At first sight, it is good news for every company. But many small companies won’t notice it.
The SME rate stays the same
Micro, small and medium-sized companies pay a reduced 15% rate on the first €50,000 of taxable profit. That rate does not change in 2027. Only the profit above €50,000 is taxed at the general rate, and that is the only part where the cut shows.
A simplified example, leaving out the municipal surcharge and autonomous taxation:
- With €40,000 of taxable profit, the company pays €6,000 in 2026 and the same €6,000 in 2027.
- With €80,000, it pays €13,200 in 2026 and €12,900 in 2027: €300 less.
What can make a difference
Your company’s tax bill depends on much more than the rate: which expenses are accepted, which tax incentives you can use, autonomous taxation and how the partners are paid. Some of these decisions must be made by 31 December, before the year closes.
Still a proposal
The 2027 State Budget proposal was submitted to Parliament on 8 October 2026. The final vote is scheduled for 24 November, and the rules may change until then.
Want to know where your company stands? Talk to us or book an exploratory meeting.
Sources: Law 64/2025; Bill 110/XVII/2 (2027 State Budget).