Who withholds IRS on a recibo verde?

Only clients that have, or must have, organised accounts (contabilidade organizada): Portuguese companies and sole traders who keep organised accounts. A private person, a foreign company with no Portuguese establishment, or a sole trader without organised accounts pays the full invoice and withholds nothing (CIRS art. 101.º n.º 1).

What are the withholding rates for recibos verdes in 2026?

23% for professions on the art. 151.º table (it was 25% until 2024; the 2025 State Budget cut it), 11.5% for other services not on the table, and 16.5% for royalties earned by the original author. The OE 2026 did not change them. Sales of goods are not subject to this withholding (CIRS art. 101.º n.º 1 als. a) to c)).

Is withholding calculated on the amount with IVA?

No. The client withholds on the fee before IVA (the valor base). On a €1,000 invoice with 23% IVA the client is billed €1,230, withholds 23% of €1,000, and pays you €1,000.

How does the €15,000 dispensa de retenção work?

If you expect less than €15,000 of Category B income in the year, you can ask clients not to withhold, by writing "Sem retenção, nos termos do n.º 1 do artigo 101.º-B do Código do IRS" on the receipt. It is optional, not available if last year's income reached €15,000, and it ends the month after you reach the limit (CIRS art. 101.º-B n.os 1 a), 2 and 3).

Why was nothing withheld on a small invoice?

Since 1 July 2025 no withholding is made when the amount of a single withholding would be under €25 (CIRS art. 101.º-B n.º 1 al. d), added by Decreto-Lei n.º 49/2025). At 23% that is any fee below €108.70.

Is the withholding my final tax?

No. It is an advance on your annual IRS. In the Modelo 3 the following spring, everything withheld during the year is credited against the tax on your whole year's income. If the advances were more than the tax, you get a refund; if less, you pay the difference.

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What will this recibo verde actually pay you?

A Portuguese business client usually keeps part of your fee as IRS withholding (retenção na fonte), and if you charge IVA it sits on top. Enter one invoice to see the IVA, the withholding and what lands in your account, under the 2026 rules.

Invoice amount before IVA (valor base, €)

What are you invoicing?

Not sure which? Look up your code in the art. 151.º code finder.

Who is the client?

€15,000 dispensa

IVA

Paid into your account

€770.00

Your client keeps 23% of the fee and pays it to the tax office (AT) in your name. Only clients with organised accounts in Portugal do this: companies, and sole traders who keep organised accounts.

Breakdown

Valor base: €1,000.00
IVA (isento, art. 53.º): + €0.00
Invoice total the client owes: €1,000.00
IRS withheld (23% of the base): − €230.00
Paid to you: €770.00

Withholding is not your final tax. The €230.00 is an advance on your annual IRS, credited to you in the Modelo 3 the following spring. If your advances add up to more than the tax on the year, you get the difference back; if less, you pay the rest. Social Security is separate and not taken from the invoice.

2026 rules for mainland Portugal (Continente). Madeira and the Açores charge lower IVA, not modelled here. Not covered: the 20% rate for IFICI holders (CIRS art. 101.º n.º 1 al. d)), reverse-charge IVA and IVA on services to foreign businesses, and expense reimbursements (art. 101.º-B n.º 1 al. b)).

How withholding on a recibo verde works

The client withholds, not you. Only clients with organised accounts in Portugal must do it (CIRS art. 101.º n.º 1). They pay it to AT in your name, and it shows up in your e-Fatura and pre-filled IRS.
The rate follows the activity. 23% for professions on the art. 151.º table, 11.5% for other services and 16.5% for an original author’s royalties. Your year of activity does not change it.
It is charged on the fee, never on the IVA.
Two ways to have nothing withheld. Use the €15,000 dispensa if you qualify (art. 101.º-B n.º 1 a)), or invoice small amounts: a withholding under €25 is not made (art. 101.º-B n.º 1 d)).
It is an advance, not the final tax. Your real IRS is worked out once a year on all your income; the withholding is credited against it. Use the income tax calculator in freelancer mode for the year, or see how much to set aside from each invoice.

IVA: exempt or charging 23%?

Under CIVA art. 53.º you charge no IVA while your yearly turnover stays within €15,000; the invoice says “IVA - regime de isenção”. Above it, or if you opt out, you add 23% on mainland invoices and pay it to AT in your quarterly IVA return. That IVA passes through your account but is not income. The exemption ends at once if you go more than 25% over the limit in the year (CIVA art. 58.º).

The withholding dispensa and the IVA exemption share the same €15,000 figure but are separate choices. All rates by region are on the IVA rates 2026 table.

Issuing the recibo

The step-by-step guide to issuing a recibo verde walks through every Portal das Finanças field, including where the withholding and IVA go. New to freelancing? The first-year guide covers the 50% IRS reduction and the Social Security deferral.

Questions

Who withholds IRS on a recibo verde?: Only clients that have, or must have, organised accounts (contabilidade organizada): Portuguese companies and sole traders who keep organised accounts. A private person, a foreign company with no Portuguese establishment, or a sole trader without organised accounts pays the full invoice and withholds nothing (CIRS art. 101.º n.º 1).
What are the withholding rates for recibos verdes in 2026?: 23% for professions on the art. 151.º table (it was 25% until 2024; the 2025 State Budget cut it), 11.5% for other services not on the table, and 16.5% for royalties earned by the original author. The OE 2026 did not change them. Sales of goods are not subject to this withholding (CIRS art. 101.º n.º 1 als. a) to c)).
Is withholding calculated on the amount with IVA?: No. The client withholds on the fee before IVA (the valor base). On a €1,000 invoice with 23% IVA the client is billed €1,230, withholds 23% of €1,000, and pays you €1,000.
How does the €15,000 dispensa de retenção work?: If you expect less than €15,000 of Category B income in the year, you can ask clients not to withhold, by writing "Sem retenção, nos termos do n.º 1 do artigo 101.º-B do Código do IRS" on the receipt. It is optional, not available if last year's income reached €15,000, and it ends the month after you reach the limit (CIRS art. 101.º-B n.os 1 a), 2 and 3).
Why was nothing withheld on a small invoice?: Since 1 July 2025 no withholding is made when the amount of a single withholding would be under €25 (CIRS art. 101.º-B n.º 1 al. d), added by Decreto-Lei n.º 49/2025). At 23% that is any fee below €108.70.
Is the withholding my final tax?: No. It is an advance on your annual IRS. In the Modelo 3 the following spring, everything withheld during the year is credited against the tax on your whole year's income. If the advances were more than the tax, you get a refund; if less, you pay the difference.

Sources

Freelancer deadlines

Get an email before IVA, Social Security and IRS are due.

Quarterly IVA, the Social Security declaration and the annual IRS each have their own date. Get a short email a week before each one. Usually one to three emails a month.

Last verified against official sources (Portal das Finanças, Segurança Social, Diário da República):

Category B withholding rates, the €15,000 dispensa and the €25 minimum — 1 November 2026
IVA rates, Listas I/II and the art. 53 exemption — 14 October 2026