In November 2026, many employees and pensioners will benefit from an extraordinary 50% reduction in IRS (Personal Income Tax) withholding, allowing them to receive a higher net income that month.
The measure applies to salaries and pensions paid during November, including Christmas bonuses when paid within that period.
Why will there be a reduction in IRS withholding?
This change follows the approval of a new reduction in IRS rates, effective from 1 January 2026.
The aim is to bring forward the tax benefits for taxpayers, allowing the impact of the tax reduction to be reflected more quickly in household income, without having to wait for the annual IRS settlement in 2027.
Who will benefit from this measure?
The reduction applies to employees and pensioners who are tax residents in mainland Portugal, with some exceptions for higher-income earners.
The additional amount received will depend on each taxpayer's monthly income, tax situation and the amount of IRS normally withheld.
What happens in December?
This extraordinary reduction applies exclusively to income paid between 1 and 30 November 2026.
From December onwards, the standard withholding tax tables will apply again.
It is also important to clarify that lower withholding does not necessarily mean an equivalent reduction in the final tax liability, as the amounts withheld are taken into account when calculating the annual IRS settlement.
Clarify Your Questions with Aldeia Fiscal
Would you like to know how this change could affect your salary, pension or Christmas bonus?
At Aldeia Fiscal, we keep up to date with tax changes and help you understand their impact on your income and tax obligations.
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