1. The diary first: 15 December

The nearest deadline is not 31 December. Article 104(1)(a) of the Corporate Income Tax Code (CIRC) sets the third instalment on account for 15 December — not the last day of the month, as with the July and September instalments. The third additional payment on account of the state surcharge falls due on the same date for companies whose taxable profit exceeded EUR 1,500,000 in the previous period (article 104-A(1)(a) CIRC).

This is the one December decision that can cut the cash outflow immediately: article 107 CIRC allows the third instalment to be suspended (paragraph 1) or capped at the gap between the tax you believe is due and what you have already paid (paragraph 3), with compensatory interest if the shortfall exceeds 20% (paragraph 2). We set out the mechanics and the risk in our article on the third instalment on account, and the amounts can be worked out in the corporate tax payments on account calculator.

Note the connection: deciding on the 15 December instalment requires a reliable estimate of the year's tax — which means much of the closing work described below has to be done already.

2. Inventories: count first, report later

Article 12(1) of Decree-Law no. 158/2009 of 13 July requires entities applying the Portuguese accounting standards (SNC) or EU-adopted international standards to use a perpetual inventory system, which means:

• Carrying out physical counts of inventories as at the end of the period, or during the period on a rolling basis so that each item is counted at least once per period (subparagraph a));
• Identifying items by nature, quantity and unit and total cost, so that the match between the physical counts and the accounting records can be verified at any time (subparagraph b)).

There are exemptions, and it is worth checking whether the company falls into one before building the process. The obligation does not apply to the entities referred to in article 9(1) of the same decree-law (article 12(2)), nor to the activities listed in article 12(4) — agriculture, animal production, beekeeping and hunting; forestry and logging; fishing and aquaculture; and retail outlets which, taken together, do not record sales above EUR 300,000 in the year nor above 10% of the entity's total sales. Also exempt are entities whose predominant activity is the supply of services, defined for this purpose as those whose cost of goods sold and materials consumed in the year does not exceed EUR 300,000 nor 20% of their operating costs (article 12(5)).

Reporting is a separate, later step. Under article 3-A of Decree-Law no. 198/2012 of 24 August (added by Law no. 82-B/2014 and amended by Decree-Law no. 28/2019), taxpayers with organised accounts who are required to prepare an inventory must file the valued inventory as at the last day of the previous year with the tax authority electronically by 31 January. For non-calendar tax periods the deadline is the end of the first month after the period ends (article 3-A(2)). Taxpayers under the simplified regime for personal or corporate income tax are exempt (article 3-A(3)).

In practice: the count belongs to December, the filing to January. Leave the count to January and there is nothing to file.

3. Autonomous taxation: what is still decided in December

Autonomous taxation is the part of the tax bill that depends least on the result and most on concrete decisions taken during the year. The relevant bands and rates in article 88 CIRC are as follows.

3.1. Vehicles

Charges relating to passenger cars, the light commercial vehicles referred to in article 7(1)(b) of the Vehicle Tax Code, and motorcycles are taxed autonomously at the rates in article 88(3):

• 8% — acquisition cost below EUR 37,500;
• 25% — acquisition cost from EUR 37,500 up to but not including EUR 45,000;
• 32% — acquisition cost of EUR 45,000 or more.

For plug-in hybrid passenger cars meeting the conditions in article 88(18) (a minimum electric-only range of 50 km and official emissions below 50 gCO2/km, or 80 gCO2/km where homologated under the Euro 6e-bis standard) and for natural-gas vehicles, the rates are 2.5%, 7.5% and 15%. Vehicles powered exclusively by electricity are taxed, at 10%, only where the acquisition cost exceeds the amount set by the ministerial order referred to in article 34(1)(e) and they are not excluded by article 88(6) (article 88(20)).

Note what counts as a charge: under article 88(5), depreciation, rentals or leasing payments, insurance, maintenance and servicing, fuel, and taxes on ownership or use. A car joining the fleet in December brings a band with it for the whole of the following period — one of the few closing decisions with a multi-year effect.

3.2. Entertainment expenses, per diems and undocumented expenses

• Entertainment expenses — 10% (article 88(7), as amended by Law no. 45-A/2024 of 31 December): receptions, meals, trips and outings offered to clients, suppliers or any other persons or entities.
• Per diems and mileage allowances for use of the employee's own car — 5%, where not rebilled to clients and however they are booked, except to the extent they are taxed in the beneficiary's hands for personal income tax purposes (article 88(9)).
• Undocumented expenses — 50%, rising to 70% for taxpayers that are wholly or partly exempt or that do not carry on a commercial, industrial or agricultural activity as their main activity (article 88(1) and (2)) — and, on top of that, non-deductible under article 23-A(1)(b).
• Payments to entities in clearly more favourable tax regimes — 35% or 55%, unless the taxpayer can show they correspond to genuine transactions and are neither abnormal nor excessive in amount (article 88(8)).

Here the December work is documentary rather than accounting. Article 23-A(1)(h) CIRC denies the deduction of per diems and employee mileage allowances not rebilled to clients wherever the employer does not hold, for each payment made, a log enabling the journeys to be verified, showing the locations, time spent, purpose and, for an employee's own car, the identification of the vehicle and its owner and the number of kilometres travelled. Missing logs cannot be invented in May.

3.3. The 10-point uplift and the 2026-specific rule

Article 88(14) raises autonomous taxation rates by 10 percentage points for taxpayers reporting a tax loss for the period. But article 95(5) of Law no. 73-A/2025 of 30 December disapplies that uplift for the 2026 tax period where the taxpayer made a taxable profit in one of the three preceding periods and filed the returns required by articles 120 and 121 CIRC for the two preceding periods; or where 2026 is the period in which activity began, or one of the two following periods.

The second condition deserves emphasis because it is administrative rather than financial: a company that failed to file its 2024 and 2025 Modelo 22 or IES returns on time loses the benefit of this rule and pays the uplift. Checking the filing history is, quite literally, a closing task.

Finally, under article 88(23), autonomous taxation is assessed under article 89 with no deductions whatsoever made against the total assessed, even deductions arising from special legislation. A loss-making company can owe tax through this route alone — which is precisely why the December estimate has to include it.

4. Provisions and impairment losses: book them, do not promise them

Article 39(1) CIRC allows three types of provision to be deducted: those intended to cover obligations and charges arising from pending court proceedings; those for charges under customer guarantees provided for in sale and service contracts; and those set aside for environmental remediation of sites used in the business, where this is legally mandatory and arises once operations cease. Subparagraph c) of article 39(1) and article 39(6) were repealed by Law no. 82-A/2023 of 29 December.

Two rules govern the timing. First, provisions must be measured on the basis of the conditions existing at the end of the tax period (article 39(2)). Second, provisions that should not be maintained, because the events they relate to did not occur, or that are used for other purposes, are treated as income of the period in question (article 39(4)). The customer-guarantee provision is subject to the cap in article 39(5): the percentage applied cannot exceed the ratio between guarantee charges actually incurred over the last three periods and the sales and services subject to guarantee over those same periods.

On receivables, article 28-A(1)(a) CIRC allows the deduction of impairment losses on trade receivables, including late-payment interest, which at the end of the tax period can be regarded as doubtful and are evidenced as such in the accounts. Those are two cumulative requirements and both are date-stamped: the receivable has to be doubtful at 31 December and it has to be recorded as such. If the objective conditions that gave rise to them later cease to apply, the impairments become positive components of taxable profit for the relevant period (article 28-A(3)).

5. Accruals and documentation: what has to be invoiced or paid within the year

Article 18(1) CIRC lays down the accruals basis: income and expenses are allocated to the period in which they are earned or incurred, regardless of when they are received or paid. Article 18(3) spells this out: sales revenue is treated as realised on the date the goods are delivered or dispatched or, if earlier, when title passes; service revenue on the date the service is completed, except for services performed continuously or in stages, which are allocated in proportion to performance.

And article 18(2) shuts the door on late corrections: positive or negative components relating to earlier periods are allocated to the current period only where, at the date the accounts for the period they belonged to were closed, they were unforeseeable or manifestly unknown. A forgotten invoice is not unforeseeable.

Three concrete December checks follow from this:

• Invoice what was delivered or completed in 2026, and accrue what has no document yet;
• Gather the documentation for expenses: article 23-A(1)(c) denies deductibility for charges whose documentation fails to meet article 23(3) and (4), and for charges evidenced by documents issued by taxpayers with a non-existent or invalid tax number, by taxpayers whose activity has been administratively declared ceased, or by taxpayers who never filed a registration return;
• Check fuel costs: article 23-A(1)(j) requires proof that they relate to assets owned by the taxpayer or used under a lease, and that normal consumption levels are not exceeded.

6. Payroll and board remuneration

Article 263(1) of the Portuguese Labour Code (Law no. 7/2009 of 12 February) is unambiguous: employees are entitled to a Christmas bonus equal to one month's pay, which must be paid by 15 December each year. The amount is pro-rated to service during the calendar year in the year of hiring, the year the contract ends, and where the contract is suspended for reasons attributable to the employee (article 263(2)). Breaching this article is a very serious administrative offence (article 263(3)).

For profit-sharing bonuses the deadline is longer but just as firm. Article 23-A(1)(n) CIRC denies the deduction of profit-sharing paid to board members and employees where the amounts are not paid or made available to the beneficiaries by the end of the following tax period. Article 23-A(1)(o) further caps, for board members holding directly or indirectly at least 1% of the share capital, the portion exceeding twice the monthly remuneration earned in the period to which the profit shared relates.

7. Two limits worth measuring before you close

• Net financing costs. Under article 67(1) CIRC they count towards taxable profit up to the greater of two limits: EUR 1,000,000 or 30% of earnings before depreciation, amortisation, net financing costs and taxes. The non-deductible excess can be carried forward for up to five periods (article 67(2)), and unused headroom under the 30% limit is added to the deductible maximum, also for up to five subsequent periods (article 67(3)). Where the period is shorter than a year, the EUR 1,000,000 limit is pro-rated by the number of months (article 67(10)).
• Carried-forward tax losses. The deduction in any period cannot exceed 65% of that period's taxable profit (article 52(2) CIRC), without prejudice to deducting the remainder in later periods on the same terms. Losses are not deductible in periods where taxable profit is determined by indirect methods (article 52(3)).

To finish the 2026 tax estimate, the applicable rates are: 19% for article 87(1) and (5) CIRC, under article 3(2) of Law no. 64/2025 of 7 November; 15% on the first EUR 50,000 of taxable base for SMEs and small mid caps qualifying under the annex to Decree-Law no. 372/2007 (article 87(2)); and 12.5% for entities qualifying as a startup that also meet the conditions in article 2(1)(f) of Law no. 21/2023 of 25 May (article 87(8)).

8. What is not a December job

To head off false urgency: the annual corporate tax return (Modelo 22) is filed by the last day of May, whether or not that is a business day (article 120(1) CIRC), and the annual accounting and tax information return (IES) by 15 July (article 121(2)). The inventory filing is due on 31 January. What has to be finished by 31 December is the substantive work those returns subsequently report.

Frequently asked questions

What actually has to be done before 31 December?

Everything the law ties to the end of the tax period: physical stock counts (art. 12(1)(a) of Decree-Law 158/2009), recording the provisions and impairments you intend to deduct (arts. 39(2) and 28-A(1) CIRC), documenting the year's expenses, and the investment decisions that fix the autonomous taxation band for vehicles. Purely filing obligations such as the Modelo 22 return or the IES fall into 2027.

Do I have to count stock on 31 December itself?

Not necessarily on that day. Article 12(1)(a) of Decree-Law 158/2009 allows counts made as at the end of the period or, during the period, on a rolling basis, provided each item is counted at least once per period. What is not acceptable is no count at all and no verifiable match between the records and what physically exists.

When must the inventory be reported to the tax authority?

By 31 January, filed electronically, covering the valued inventory as at the last day of the previous year (art. 3-A(1) of Decree-Law 198/2012). Taxpayers with a non-calendar tax period file by the end of the first month after the period ends (art. 3-A(2)). Taxpayers under the simplified regime for personal or corporate income tax are exempt (art. 3-A(3)).

Does buying the car in December rather than January change the tax?

It does, on two fronts. The autonomous taxation band is set by acquisition cost — 8% below EUR 37,500, 25% from EUR 37,500 to EUR 45,000, 32% at EUR 45,000 and above (art. 88(3) CIRC) — and the charges listed in art. 88(5) start counting from the moment they exist. For plug-in hybrid passenger cars meeting the conditions in art. 88(18) and for natural-gas vehicles, the rates are 2.5%, 7.5% and 15%.

If the company closes 2026 with a tax loss, does autonomous taxation go up by 10 points?

Not automatically in 2026. Article 88(14) CIRC raises the rates by 10 percentage points where there is a tax loss, but article 95(5) of Law no. 73-A/2025 of 30 December disapplies that uplift for the 2026 tax period where the taxpayer made a taxable profit in one of the three preceding periods and filed the returns required by articles 120 and 121 CIRC for the two preceding periods, or where 2026 is the period activity began or one of the two following periods.

Can I book a provision in December to cut the tax bill?

Only if it fits one of the cases in article 39(1) CIRC — pending court proceedings, customer guarantees provided for in sale or service contracts, or environmental remediation that is legally mandatory once operations cease. The measurement must be based on the conditions existing at the end of the tax period (art. 39(2)), and the customer-guarantee provision is capped by the percentage formula in art. 39(5). It is not a discretionary line.

What about profit-sharing bonuses to shareholders and employees?

They are deductible in the year they relate to, but article 23-A(1)(n) CIRC denies the deduction where the amounts are not paid or made available to the beneficiaries by the end of the following tax period. For board members holding 1% or more of the share capital there is a further cap in article 23-A(1)(o).

Sources and legal references

• Articles 18, 23-A, 28-A, 34, 39, 52, 67, 87, 87-A, 88, 104, 104-A, 107, 120 and 121 CIRC — accruals, non-deductible charges, impairment of receivables, non-deductible depreciation, provisions, tax losses, financing costs, rates, the state surcharge, autonomous taxation, payment rules and filing deadlines.
• Article 12 of Decree-Law no. 158/2009 of 13 July — perpetual inventory, physical counts and exemptions.
• Article 3-A of Decree-Law no. 198/2012 of 24 August — filing of inventories with the tax authority by 31 January; exemption for the simplified regime.
• Article 263 of the Labour Code (Law no. 7/2009 of 12 February) — Christmas bonus payable by 15 December.
• Article 3(2) of Law no. 64/2025 of 7 November — the 19% corporate tax rate for tax periods beginning during 2026.
• Article 95(5) of Law no. 73-A/2025 of 30 December — disapplication of the article 88(14) uplift in the 2026 tax period.
• Law no. 82-A/2023 of 29 December — repeal of article 39(1)(c) and article 39(6) CIRC.
• The Corporate Income Tax Code was consulted at info.portaldasfinancas.gov.pt; the other statutes in the Diário da República.