Maria Inês Assis and Joana Monteiro de Oliveira explain how alimony can be taxed under IRS
Alimony is considered taxable income under the Portuguese IRS system (Personal Income Tax). Maria Inês Assis and Joana Monteiro de Oliveira, partner and senior associate lawyer respectively at Abreu Advogados, specialists in Tax Law, explained to ECO that “the total amount of alimony received during the year, as well as the taxpayer identification number (NIF) of the parent who pays the alimony, must be indicated”.
The beneficiary may choose between a special flat rate of 20% or include the amount into their total income, with taxation applying only to the portion exceeding €4,350.24 annually: “only the remaining amount (if any) is subject to IRS,” the lawyers affirm.
The receiver and the payer must declare the amounts and the NIFs of both parties in Annexes A or H, with these cases being excluded from the automatic IRS system.
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