sexta-feira, fevereiro 12, 2010

Portugal: Tax on Bonuses Proposed

Portugal’s 2010 budget proposal presented on 27 January 2010 includes penalty taxes that would be levied at the company level on bonus payments made to directors, managers and board members.

The measure, one of the most notable in the proposed budget, would establish a separate corporate income tax levy at a flat rate of 35% on the payment of bonuses or other types of variable payments made to directors, managers and other board members that represent more than 25% of the individual’s annual salary and exceed EUR 27,500. However, if the payment of the bonus is subject to a deferred remuneration scheme that lasts at least three years, represents more than 50% of the amount paid and is subject to the company’s positive performance during those years, the 35% penalty tax would not apply.

The penalty tax – and in this case no exception would be applied – would increase to 50% on bonuses paid to (or incurred with) board members in the financial sector (i.e. financial and credit institutions) during 2010.

The budget proposal still must be approved by Parliament, which is expected to consider the measures in March 2010.

Deloitte Portugal

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