Deduction of tax losses

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 65% of the taxable profit of the year in which the deduction is made. Tax losses assessed in 2020 and 2021 benefit from an additional deduction of 10 percentage points against the taxable profit.

What is the Time Limit for the Deduction of Tax Losses?

Since 1 January 2023, there is no time limit for the deduction of tax losses.

This rule shall apply to the deduction of tax losses against the taxable profit of tax years starting on or after 1 January 2023. It will also apply to tax losses assessed in tax years before 1 January 2023, provided the carry-forward period has not expired.