FLEX ON Corporate Term Deposit

For individual residents, deposit income is subject to withholding tax under personal income tax (IRS) at a final withholding rate of 28% (19.6% for deposit income earned by residents of the Autonomous Region of the Azores), with the option for aggregation. Aggregation is mandatory for income derived from business and professional activities.

For corporate taxpayers (IRC) resident or established in Portugal, deposit income is subject to withholding tax at a rate of 25% (17.5% for deposit income earned by residents of the Autonomous Region of the Azores). This withholding serves as an advance payment of the final tax due.

A withholding tax of 35% applies in all cases where income is paid or made available in accounts opened in the name of one or more holders but on behalf of unidentified third parties, except when the beneficial owner is identified, in which case the general rules apply.

Deposit income obtained by non-residents without a permanent establishment in Portugal to which such income is attributable is subject to IRS (individuals) via withholding at 28% or IRC (corporations) via withholding at 25%.

The aforementioned income is subject to a final withholding tax of 35% whenever it is paid or made available in accounts opened in the name of one or more holders but on behalf of unidentified third parties, except when the beneficial owner is identified, in which case the general rules apply.

The same 35% final withholding tax applies when the income is paid or made available to non-resident individuals or corporations without a permanent establishment in Portugal and domiciled in a country, territory, or region subject to a clearly more favorable tax regime, as listed in Ordinance No. 150/2004 of 13 February.

Under double taxation treaties concluded by Portugal, the withholding tax rate may be limited to 15%, 12%, or 10%, depending on the applicable treaty and provided that the formalities required by law are fulfilled. Limitation of the applicable withholding tax may occur through partial exemption or refund of excess tax withheld.

This information is a summary of the tax regime in force at the time of deposit opening and does not replace consultation of the applicable legislation.

Deposits held at Banco Comercial Português S.A. are covered by the reimbursement guarantee provided by the Deposit Guarantee Fund (Fundo) in the event that deposits become unavailable due to reasons directly related to the Bank’s financial situation.

The Fund guarantees reimbursement up to a maximum of €100,000 per depositor. When calculating the value of each depositor’s deposits, the total of all deposit accounts is considered on the date the payment unavailability occurred, including interest. For deposits in foreign currency, amounts are converted into euros at the exchange rate on that date .

For further information, please consult: www.clientebancario.bportugal.pt/ and www.fgd.pt.