Tables withholding the IRS updated at 0.8% – Jornal de Negócios – Portugal

The rates of withholding of tax apply to salaries and pensions earnings throughout this year are ready and have already been sent for publication in the Diário of the Republic. However, given that there were no changes in the relief on the tax, the disturbed are also minimal, reducing it practically to the update of the levels to inflation.

There are two types of tables that will be updated for 2017: that which translates the IRS to withhold at source in the course of the general table provided for in article 68 of the Code of the IRS – the IRS normal, let us call it that – and a second that refers to the surcharge, which will continue to apply if the third level onwards, although with average rates below.

In the first case, the “IRS normal”, there will be an update of the brackets (which define a threshold of a pension or salary from which applies the retention rate) at 0.8%, said on Thursday to journalists the secretary of State for Fiscal Affairs, at the end of a conference organised by the Portuguese Fiscal Association (that is, who is even at the limit of the level of income and have an increase up to 0.8%, it does not jump to a new tier, while maintaining the same monthly withholding).

These 0,8% correspond to the rate of inflation for 2016 which has been updated to own the main table of the IRS to 2017 and will serve to ensure that those who have an average increase in line with inflation will not be penalized in taxes because of it.

The surcharge, which also has a table of its own, suffers from a similar effect. Here already there is only three income levels (in the case of the surcharge, there is an alignment of the ranks by the general table of the IRS), whose limits will be updated at 1,305%.

According to Fernando Rocha Andrade, the update of the surcharge to a percentage higher serves to compensate for the fact that the Government, in 2016 not to have updated for inflation. Now compensates for this effect by adding 0.8% on the basis of the updates for 2017 with the 0.5% of last year.

The tables were signed this Thursday, January 12, by Fernando Rocha Andrade, but, in some cases, they may not arrive in time to be applied in January. There, the procedure is the usual: the entities that process payments apply from 2016, making the reckoning in the next year.

Hits arrive in 2018
The rates of withholding are forms of the State to anticipate the taxes that you have to receive in a year, dividing by instalments smoother by which the final invoice is only calculated for the following year. So it is with the “IRS normal” and it is so with the surcharge that even if you go quenching throughout the year in the form of withholding tax.

The vast majority of taxpayers who have income from dependent work and pensions holds above what is necessary, so the hits tend to give rise to a refund.