Donation Tax benefits
Under the Tax Benefits Statute (published by Decree-Law no. 108/2008 of 26 June), the following tax benefits apply to the donation of goods as gifts:
- in terms of IRC: donations are considered deductible expenses in the respective financial year by 140%, up to a limit of 8/1000 of the volume of sales or services provided by the patron (the value of the donation to be considered is the tax value of the goods in the financial year in which they are donated, less, where appropriate, depreciation or provisions effectively practised and accepted as a tax cost), paragraph a) of no. 3, paragraph c) of no. 4 and no. 11 of article 62 of the EBF;
- in terms of IVA: donations made by patrons subject to IVA are exempt, with the right to deduct the IVA incurred in the respective acquisition/production (Article 15(10)(a) and Article 20(1)(b) IV of the IVACode);
- in terms of IRS: donations in cash may be deducted from the IRS taxable amount by 25% of the amount awarded, up to a limit of 15% of the taxable amount – Article 62(3)(a) and Article 63(1)(b) of the EBF.
In the case of donations of goods allocated to the business activity of an IRS category B taxpayer with organised accounts, the deduction will be made under the terms and conditions mentioned above for IRC.
To issue the Donation Receipt, the following data will be required:
- Name of the organisation/person
- Full address of the organisation/person
- Tax number of the organisation/person
- Amount of the donation.