How to reduce IRS with e-Fatura, receipts and tax deductions

Understand what exactly deductions reduce

Dedução à coleta (a deduction from the calculated tax) reduces IRS, but it is not a payment in itself. First Autoridade Tributária e Aduaneira, AT (the tax authority) calculates the tax, then applies the allowable deductions and compares the result with what your employer has already withheld or you have paid.

If more was withheld than the final tax, the difference may be refunded. If less, you will have to pay the rest. A deduction cannot create a refund when the calculated tax is not enough, and some deductions are also capped by an overall limit that depends on taxable income and the make-up of the household.

Ask for your NIF on every eligible invoice

When paying, give your NIF (tax number) and ask for a fatura (invoice) or fatura-recibo (invoice-receipt). For a child's expenses you can give the child's NIF if they are included in the agregado familiar (household).

Most Portuguese invoices are sent to e-Fatura by the seller automatically, but with a delay. Do not add an invoice by hand straight away: first check that it has the right NIF and wait a few days. Keep invoices and proof of payment for at least four years in case of an inspection.

Check and assign your invoices in e-Fatura

Log in to Portal das Finanças (the tax portal) separately with the NIF of each adult and child. Open e-Fatura, find Faturas pendentes (invoices without a category) and choose the right sector. For 2025 invoices AT set a deadline of 2 March 2026 for checking and classifying them.

You can only choose a category if the seller has the matching CAE (activity code) registered. You cannot count an administrative service as education just because a university provided it. Medical expenses with 23% IVA (VAT) may require a prescription.

If you have an atividade (self-employment) open, also mark whether the purchase relates to your work fully, partly or not at all. This is not the same as a personal IRS deduction or an IVA refund.

Know the main categories and their limits

For 2025 expenses the main rules are: Despesas gerais familiares (general household expenses) — 35% of expenses, but no more than €250 per taxpayer; on a joint return for spouses usually no more than €500 for the two. Children do not add another €250 of limit each, though their invoices count as household expenses.

Saúde (health) — 15% of eligible expenses, up to €1,000 per household. Educação e formação (education and training) — 30%, usually up to €800 per household. Lares (care homes and care) — 25%, up to €403.75. These amounts are the deduction, not the amount you spend.

There is a general deduction for IVA in certain sectors: car and motorcycle repairs, restaurants and hotels, hairdressers, vets, sport and some cultural services. Usually a share of the IVA paid counts, and the overall limit for this group is €250 per household. Travel passes, newspapers and magazines have their own IVA shares, but they use the same overall limit.

Check the rent on your permanent home separately

The deduction applies only to rent on a habitação permanente (permanent home), if the contract is registered, the landlord issues recibos de renda eletrónicos (electronic rent receipts) and the home is linked to your permanent address. For 2025 expenses the basic deduction is 15% of eligible rent with a maximum of €700 per household; for low taxable incomes the limit could be raised by the formula in article 78.º-E CIRS, but to no more than €1,100.

Receipts from a private landlord may not appear among ordinary e-Fatura invoices. After 15 March check them in the Despesas para deduções à coleta (expenses for tax deductions) section. A contract purpose of Habitacional (Não Permanente) (a home not for permanent residence), a wrong address or missing receipts can leave you with no deduction at all.

Do not multiply the limit by the number of household members: it is a household limit, not a separate maximum for each person. Mortgage interest usually counts only for contracts signed before 31 December 2011.

Check expenses that are not among ordinary invoices

Once the final totals are ready, open the Consultar Despesas para Deduções à Coleta (check expenses for deductions) section on Portal das Finanças. Rent, health insurance, interest on old mortgage contracts, tuition and other details that organisations send directly to AT may appear there.

Compare the amounts for each household member and each category with your own invoices. Do not rely only on e-Fatura or the preliminary simulator: the final amounts may differ because of household limits, the overall cap on deductions and how expenses are split between spouses.

Correct eligible expenses through Anexo H

If expenses are missing in the Saúde, Educação, Habitação or Lares categories, open Anexo H (the annex on tax breaks and deductions) when filling in Modelo 3 de IRS (the annual return). In Quadro 6C (the expenses table) you can reject the amounts sent to AT and enter the details by hand.

This is a serious risk: entering them by hand replaces the automatic details for that category for the whole agregado familiar, rather than just adding one missing invoice. So enter all the expenses in that category again for every household member and keep the supporting documents. General household expenses and the IVA deduction usually cannot be topped up this way.

If the problem is an unregistered rental contract or wrong receipts, first ask the landlord to correct the details. A request through e-Balcão (the tax authority's online help desk) or a Serviço de Finanças (tax office) can take months.

Add separate tax breaks only after checking the conditions

Besides receipts there are benefícios fiscais (tax breaks), for example a PPR (retirement savings plan) and donations. For a PPR the deduction is 20% of the amount paid in, but the maximum depends on your age at the end of the year: under 35 — €400, from 35 to 50 — €350, over 50 — €300. This does not mean the state gives back the whole contribution.

Withdrawing from a PPR early, other than in the cases the law allows, may mean paying the tax break back with a surcharge. Also, a PPR and other deductions may hit the overall limit on deduções à coleta, so first compare the return with and without the tax break.

File IRS and check the final assessment

Modelo 3 de IRS for 2025 is filed from 1 April to 30 June 2026. Before submitting, run the simulation for tributação conjunta (joint taxation of spouses) and tributação separada (separate taxation), if both are available.

Once processed, download the Demonstração de Liquidação de IRS (tax assessment). It shows the deductions actually accepted in each category. For a refund, register and confirm your IBAN on Portal das Finanças in advance; a simulation before the return is processed is not a final decision by AT.