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IRS Jovem 2026: who qualifies, percentages and limit
A law has been approved that lowers the rates of the first six IRS brackets with effect from 1 January 2026. The Government's decree-law is still missing; when it is published, the figures in this guide will be updated. The Portuguese State Budget proposal for 2027, still being debated in Parliament (final vote scheduled for 24 November), would raise the IRS bracket limits by 3.88% and the minimum subsistence amount (mínimo de existência) to €13,580 from 2027 income.
IRS Jovem is a partial exemption from IRS (personal income tax) for young workers, set out in art. 12-B of the IRS Code (Código do IRS). Since 2025 it is a single scheme, wider than the old one: it does not require a university degree and lasts up to 10 years. Foreign residents who pay tax in Portugal can use it if they meet the conditions below.
Who qualifies for IRS Jovem in 2026?
According to the official Tax Authority (Autoridade Tributária, AT) leaflet, you must meet all of these requirements:
- Be 35 or younger on 31 December of the income year.
- Have income from employment (category A) or from business/professional activity (category B), for example recibos verdes (freelance invoices).
- Not be a dependant in a household (you file as a taxpayer, sujeito passivo).
- Have your tax situation in order (situação tributária regularizada).
You are excluded if you benefit or have benefited from the Non-Habitual Resident (Residente Não Habitual) scheme or IFICI, or if you chose the former residents scheme (Programa Regressar).
IRS Jovem percentages: how much is exempt each year?
The exemption depends on your year of work income, counted from the first year you had category A or B income while not being a dependant — even if that year was before 2025.
| Income year | Exempt income |
|---|---|
| 1st year | 100% |
| 2nd, 3rd and 4th years | 75% |
| 5th, 6th and 7th years | 50% |
| 8th, 9th and 10th years | 25% |
Years in which you had no A/B income, were a dependant or were excused from filing a return do not count.
What is the IRS Jovem limit?
Exempt income is always capped at 55 times the IAS (Indexante dos Apoios Sociais, the social support index).
| Income year | IAS | Limit (55 × IAS) |
|---|---|---|
| 2025 | 522,50 € | 28 737,50 € |
| 2026 | 537,13 € | 29 542,15 € |
The 2026 figure (55 × 537,13 € = 29 542,15 €) is given by the AT itself in Newsletter no. 39, January 2026.
Exempt income still counts when working out the rate that applies to the rest of your income (englobamento para efeitos de taxa).
Example (illustrative): Ana, single, is in her 3rd income year and earns 20 000 € gross in 2026. The exemption is 75% × 20 000 € = 15 000 €, below the limit. Only 5 000 € is subject to IRS.
Example (illustrative): Rui is in his 1st year and earns 35 000 €. The exemption would be 100%, but it is capped at 29 542,15 €. The remaining 5 457,85 € is taxed.
How to claim IRS Jovem on your monthly withholding
To get the benefit straight away in your monthly salary:
- Check which income year you are in (look at previous years’ returns on the Portal das Finanças).
- Tell your employer that you want IRS Jovem and state your income year (e.g. “4th year”). There is no official form — an email is enough.
- The company calculates the withholding rate on your total salary and applies it only to the non-exempt part.
- The monthly exempt part is capped at 55 × IAS ÷ 14.
You do not need to prove that you are not a dependant to make this request.
Example from the AT leaflet (2025 figures): salary of 1 800 €, 4th year (75% exempt). Effective withholding rate on the total: 14,56%. Non-exempt part: 450 €. Withholding: about 65 €, instead of 262 €.
To see the effect in your case, use the net salary calculator (in Portuguese).
How to claim IRS Jovem in your annual tax return
- Log in to the Portal das Finanças between 1 April and 30 June.
- In the Modelo 3 return, tick the IRS Jovem option in the relevant sections of annexes A and/or B (for 2025 income onwards there are specific sections).
- Enter the year of your first work income, if asked.
- Simulate and submit.
The choice is yearly: you must make it in every return. If you are on automatic IRS (in Portuguese), you can choose the option when you confirm the return.
Since Decreto Regulamentar n.º 5-A/2026, young people covered by the scheme can use automatic IRS (IRS Jovem leaflet). In the provisional return you must state that you choose IRS Jovem: if you do not confirm, the assessment becomes final without IRS Jovem.
Common mistakes
- Counting the years wrongly. Year 1 is the first year with work income as a taxpayer, even before 2025 — not the first year of IRS Jovem.
- Forgetting to tick the option in the return. Without it, the exemption is not applied, even if your employer withheld less.
- Being included as a dependant by your parents. In that year you do not benefit and the year does not count.
- Telling your employer the wrong year. Too little withholding means tax to pay in August.
- Thinking it also exempts Social Security. IRS Jovem only reduces IRS; the 11% contributions stay the same.
See also the IRS brackets (in Portuguese) and the net salary in Portugal guide.
Frequently asked questions
Up to what age can I get IRS Jovem?
Up to and including age 35, checked on 31 December of the income year. From the year you turn 36 you no longer qualify.
Do I need a university degree for IRS Jovem?
No. Since 2025 the scheme no longer depends on finishing a course of study. You only need to be 35 or under, not be a dependant and have category A or B income.
What is the IRS Jovem limit in 2026?
Exempt income cannot be more than 55 times the IAS. With the 2026 IAS (537,13 €), the limit is 29 542,15 € per year.
Does IRS Jovem apply to recibos verdes (freelance income)?
Yes. It covers employment income (category A) and business and professional income (category B).
If I did not ask my employer, do I lose IRS Jovem?
No. The benefit is applied in the annual return if you tick the option. Asking your employer only means you get the difference every month instead of in your refund.