Companies registered in Madeira, one of Portugal’s autonomous regions, are subject to a standard corporate income tax rate of 13,3%.
Companies licensed to operate under the Madeira International Business Centre (IBCM) are entitled to additional tax benefits, namely:
- Corporate income tax rate – 5%
- Tax on dividend distributions – 0%
- Capital gains tax – 0%
- Royalty tax – 0%
All double taxation agreements apply.
The corporate tax rate applies to a specific annual profit threshold, depending on the number of jobs created by the company:
- EUR 2,730,000 – creation of 1 to 2 jobs;
- EUR 3,550,000 – creation of 3 to 5 jobs;
- EUR 21,870,000 – creation of 6 to 30 jobs;
- EUR 35,540,000 – creation of 31 to 50 jobs;
- €54,680,000 – creation of 51 to 100 jobs;
- EUR 205,500,000 – creation of more than 100 jobs.
VAT number
Portuguese companies, including those registered in Madeira, which have been issued with a VAT number are entitled to apply a zero-rate VAT on the export/import of goods.
Audit
An LDA is exempt from financial statement audits provided that, for two consecutive years, the company does not exceed two of the following three thresholds:
- Revenue: over EUR 3,000,000;
- Net assets: over EUR 1,500,000;
- Number of employees: over 50.
