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In Portugal, it is possible for a company to deduct tax losses from previous years from the taxable profit of the current year. These losses can be deducted up to 70% of the taxable profit of the year in which the deduction is made. The exception to this rule occurs in the case of tax losses recorded in 2020 and 2021, which may be deducted up to 80% of the taxable income calculated.

 

What is the time limit for the deduction of tax losses?

It depends on the year in which the losses were generated. In 2020, the deadline for carrying forward tax losses is 12 years, for companies of any size. However, in other years the carry forward period is only 5 years (12 for SMEs). Check the following table:

 

Tax Losses

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NEWCO is an inward investment services provider specialized in the implementation of foreign investment in Portugal and Malta. With 30 years of experience and know how, we help our clients maximize the opportunities and minimize the risks of operating in a new country, allowing them to stay focused on their business. Contact us to find out how we can help you invest or relocate into Portugal, including Madeira, or Malta.

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