The IRS – Personal Income Tax continues, in 2026, to be one of the tax regimes with the greatest impact on household budgets and workers in Portugal. Proper preparation and submission of the annual tax return is essential to ensure maximum deductions, tax benefits, and avoid potential corrections by the Tax Authority (AT).
Although many procedures have remained consistent in recent years, many taxpayers still face difficulties validating expenses, understanding tax brackets, applying deductions, and efficiently using the Tax Portal.
At FA ACCOUNTING, we assist hundreds of taxpayers every year and know that a small detail — a poorly communicated expense, a wrongly selected category, or an incorrectly associated dependent — can result in loss of refund or additional tax payable. In this article we explain the IRS framework for 2026, the main changes, and how to prepare a correct and optimized declaration.
What is IRS and who must file the declaration?
IRS applies to income earned by individuals residing or with taxable income in Portugal. In 2026, taxpayers must file a return if they earned income under the following categories:
- Category A – Employment income
- Category B – Self‑employment
- Category E – Capital income
- Category F – Rental income
- Category G – Capital gains and other patrimonial increases
- Category H – Pensions
Only taxpayers with very low income and exclusively covered under legal exemption rules are exempt from filing — a situation that is not always clear for many individuals.
IRS Calendar 2026
As in previous years, the single submission period remains:
April 1 to June 30, 2026
Submitting outside this period results in interest and fines, so early preparation is recommended.
Expenses that influence IRS in 2026
Deductions continue to be one of the most relevant ways to reduce tax or increase refunds. In 2026, the main deductible expenses remain:
General Family Expenses
Includes daily purchases and services automatically communicated via the e‑invoice system.
Deduction: up to €250 per taxpayer.
Health
- Consultations and treatments
- Medication
- Clinical exams
Deduction: 15% up to €1,000.
Education
- Tuition fees
- School supplies
- Educational activities
Deduction: 30% up to €800, higher for students living away from home.
Housing
- Interest on old home loans (before 2011)
- Rent for primary residence
Nursing Homes
For taxpayers or relatives in assisted living institutions.
Tax Benefits
- PPR retirement savings plans
- Donations
- Health insurance
- IVAucher when applicable
- Temporary tax incentives from the 2026 State Budget
All values depend on correct communication by entities and validation by the taxpayer.
Model 3 and Annexes: what must be submitted?
Selecting the correct annexes is essential. In 2026, the following remain in effect:
- Annex A – Employment and pensions
- Annex B – Self‑employment (simplified regime)
- Annex C – Organized accounting
- Annex E – Capital income
- Annex F – Rental income
- Annex G – Capital gains
- Annex H – Tax deductions and benefits
Incorrect annex selection is one of the most common causes of tax return corrections.
Automatic IRS 2026: who can benefit?
The Automatic IRS remains available to many taxpayers but not to all.
Eligible taxpayers:
- Employees
- Pensioners
- Individuals with simple income situations
Not eligible:
- Self‑employed workers with business expenses
- Property owners receiving rental income
- Taxpayers with capital gains
- Shared custody situations with specific tax conditions
Most common IRS errors in 2026
- Incorrect or duplicated dependents
- Expenses not validated in the e‑invoice system
- Missing or incorrect annexes
- Incorrect household composition
- Omission of foreign income
- Errors in rental or capital gains reporting
Many of these errors lead to manual corrections, fines, or loss of tax benefits.
How to optimize your IRS 2026 declaration
Timely validation of expenses
Ensures accuracy at submission time.
Careful review of annexes
A major cause of tax discrepancies.
Document organization
All receipts should be kept for verification.
Early tax planning
PPR contributions, donations, and tax benefits should be planned before year‑end.
How FA ACCOUNTING can help
At FA ACCOUNTING, we support taxpayers of all profiles — employees, freelancers, investors, landlords, and pensioners. We ensure that:
- Your declaration is error‑free
- Your tax deductions and benefits are maximized
- Your filing complies with 2026 regulations
- Your tax burden is legally optimized
We also develop a Personalized Tax Efficiency Plan tailored to each household.
Prepare your IRS 2026 securely
Contact us today for specialized support and maximize your refund.