Moving to Madeira: the tax guide

In short

• Madeira is part of Portugal, so the NIF, Social Security, IFICI and the yearly IRS return work as on the mainland.
• If your tax residence is in Madeira, IRS is charged at lower regional rates set by the regional government.
• Companies based in Madeira pay 10.5% IRC on the first €50,000 of profit (SMEs) and 13.3% above, against 15% and 19% on the mainland.
• The Madeira International Business Centre offers 5% IRC until 2033 for licensed companies that create jobs in Madeira.

Lower IRS for Madeira residents

Madeira sets its own IRS rates within limits fixed by national law. Every bracket is lower than on the mainland, and the reduction is largest in the lower and middle brackets. The regional rates apply when your tax residence, the address registered with the tax office, is in Madeira.

Companies in Madeira

The International Business Centre (Free Trade Zone)

• Licensed companies pay 5% IRC on profit from activities carried out in Madeira, now until 2033.
• The licence is granted by SDM, the company that manages the centre. New companies need to be licensed by the end of 2026.
• The company must create and keep jobs in Madeira. The amount of profit taxed at 5% is capped according to the number of jobs.

For a one-person consultancy, the job and substance rules often make the free zone less attractive than it looks. A normal Madeira company at 10.5% is frequently the simpler choice.

Living and working in Madeira

• Madeira has an established community of remote workers and good flight links to Lisbon and much of Europe.
• IFICI is available on the same terms as on the mainland if your work qualifies. See the IFICI guide.
• Your tax address must actually be in Madeira for the regional rates to apply. Keep a lease or deed to show it.

Sources: Autoridade Tributária, tax rates 2026, RTP on the free zone extension.

Frequently asked questions

Is income tax lower in Madeira than in Lisbon?

Yes. Residents of Madeira pay IRS at regional rates that are lower than the mainland rates in every bracket. The exact table is set by the regional government each year.

What is the corporate tax rate in Madeira in 2026?

13.3%, or 10.5% on the first €50,000 of profit for small and medium companies. Licensed companies in the International Business Centre can pay 5% until 2033, subject to job creation.

Can I use IFICI if I live in Madeira?

Yes. IFICI is a national regime and applies in Madeira on the same conditions as on the mainland.