The Madeira Regional Budget for 2024 has approved a set of appealing tax measures for those looking to invest in this Autonomous Region. The key measures to highlight are the following:

(i) Reduction of the Personal Income Tax (PIT) rate to 19.6% (previously 28%) applicable to dividends and interest paid to shareholders of companies based in Madeira;

(ii) Update of PIT brackets, as well as a reduction of 30% of the definitive withholding tax rates applicable under the PIT Code;

(iii) Reduction of the Corporate Income Tax (CIT) definitive withholding tax rates in most payments made to non-residents by 30%. This reduction does not apply to capital income paid to entities based in tax havens or to accounts with unidentified holders;

(iv) CIT rate of 8.75% on the first €50 000 of taxable income for start-ups established in Madeira. For any remaining amount, the standard rate of 14.7% will apply.

The rules regarding the application of the 30% differential to IRS and IRC fixed tax rates will come into effect on January 1, 2025.

For further information on this topic, please do not hesitate to contact the Tax Law Department at Ana Bruno & Associados, Sociedade de Advogados, SP RL.