Minimum Wage Portugal 2026: Net Pay, Deductions and Employer Cost
By Hugo Ribeiro, Certified Accountant · Member of the Order of Certified Accountants · HVR Business Consulting
Minimum Wage in Portugal 2026: Net Pay, Cost to the Employer and Deductions
By Hugo Ribeiro, Chartered Accountant (Contabilista Certificado, OCC) · HVR Business Consulting · April 2026
The national minimum wage in Portugal in 2026 is EUR 920 gross per month, which comes to EUR 818.80 net for the employee (no income tax is withheld). The total cost to the employer of one worker on the minimum wage is roughly EUR 1,283 per month, including the employer’s social security contribution of 23.75%.
Minimum wage Portugal 2026 — full table
Item
2026 amount
Gross minimum wage
EUR 920/month
Employee social security contribution (11%)
-EUR 101.20
Income tax withheld
EUR 0 (exempt — subsistence minimum of EUR 12,880)
Net minimum wage
EUR 818.80/month
Employer social security contribution (23.75%)
+EUR 218.50
Total cost to the employer
~EUR 1,283/month
Figures calculated for a single worker with no dependants, mainland Portugal. The Azores and Madeira have their own withholding tables.
Why a minimum-wage worker pays no income tax in 2026
The subsistence minimum in 2026 is EUR 12,880 a year (EUR 920 × 14 months), exactly the annual minimum wage. A worker earning precisely the minimum wage for a full year therefore falls below the income tax threshold: withholding is zero and no tax is due. The alignment is deliberate, so that a rise in the minimum wage is not partly cancelled out by a rise in income tax.
The real cost of the minimum wage to employers in 2026
Cost
Estimated amount/month
Base salary
EUR 920
Employer social security contribution (23.75%)
EUR 218.50
Workplace accident insurance (~1%)
EUR 9.20
Meal allowance (22 days × EUR 6.15 — tax exempt)
EUR 135.30
Estimated total monthly cost
~EUR 1,283
Estimated total annual cost
~EUR 17,500
Minimum wage in Portugal 2020-2026
Year
Gross minimum wage
Change
2020
EUR 635
+3.3%
2021
EUR 665
+4.7%
2022
EUR 705
+6.0%
2023
EUR 760
+7.8%
2024
EUR 820
+7.9%
2025
EUR 870
+6.1%
2026
EUR 920
+5.7%
Portugal has committed to reaching a minimum wage of EUR 1,020 by 2028, which implies annual increases of around EUR 50 over the next two years.
What the increase means for employers
For employers with staff on the minimum wage: the rise from EUR 870 to EUR 920 adds EUR 50 per month per employee, which works out at roughly EUR 700 a year per employee once social security and the proportional holiday and Christmas allowances are included.
For employers bound by collective agreements: many company-level and sector-level agreements set pay as a percentage above the minimum wage. A rise in the minimum wage can therefore force a cascade of increases across the whole salary structure.
Pay-rise incentive: the Incentive for the Capitalisation of Companies (ICE) and the pay-rise incentive in art. 19-B of the Tax Incentives Statute (EBF) allow 150% of salary increases above 4.6% to be deducted for corporate tax purposes — a mechanism that can significantly reduce the effective cost of paying above the minimum wage.
The 2026 minimum wage is 920 EUR gross / 818.80 EUR net (IRS-exempt).
Total cost to the company is around 1,283 EUR/month (with TSU, insurance and meal allowance).
The meal allowance is additional and not part of the minimum wage.
Portugal aims for a 1,020 EUR minimum wage by 2028.
FAQ
What is the net minimum wage in Portugal in 2026?
EUR 818.80/month for a single worker with no dependents (EUR 920 gross minus EUR 101.20 Social Security minus EUR 0 IRS). A minimum-wage worker is IRS-exempt because annual income is below the EUR 12,880 existence minimum.
What is the total cost of a minimum-wage worker to the company in 2026?
Approximately EUR 1,283/month, including: EUR 920 base salary, EUR 218.50 employer TSU (23.75%) and EUR 9.20 work-accident insurance. Add the meal allowance (up to EUR 6.15/day in cash, exempt from TSU and IRS).
Does the minimum wage include the meal allowance?
No. The meal allowance is a supplementary benefit and does not count toward the national minimum wage. The worker is entitled to both separately.
Can a company pay below the minimum wage?
No. The minimum wage is the legal minimum base pay for full-time employees. Paying below it is a labour offence subject to a fine.
What is the expected minimum wage for 2027 and 2028?
Portugal has committed to reaching EUR 1,020 by 2028, implying annual rises of about EUR 50. The 2027 value should be around EUR 970 gross/month, subject to State Budget approval.
