Investment Support Tax Regime

Everything you need to know about the RFAI - Tax Benefit for Business Investment

• RFAI Methodology - REWARD Consulting

  • Preliminary meeting
  • Mid-term meeting
  Technical description of investments
  • Calculation of the value of the RFAI tax benefit
  Post-submission follow-up Mod. 22 IRC

• Recipients

  Applicable to IRC taxpayers who carry out activities included in the following CAE (Rev. 3):
  Extractive industries – divisions 05 to 09;
  Manufacturing industries – divisions 10 to 33;
  Accommodation – division 55;
  Restoration and similar – division 56;
  Editing activities - division 58;
  Filming activities, video and production of TV programs – group 591;
  Consulting and computer programming and related activities – div. 62;
  Data processing activities, domiciliation of information and related activities and Web portals – group 631;
  Scientific research and development activities – division 72;
  Activities of interest to tourism – subclasses 77210, 90040, 91041, 91042, 93110, 93210, 93292, 93293 and 96040;
  Administrative and support services provided to companies - classes 82110 and 82910.

• Access conditions

  IRC taxpayers who cumulatively meet the following conditions may benefit from the tax incentives:
  Have organized accounting, in accordance with accounting standards and other legal provisions in force;

  Taxable income is not determined by indirect methods;
  Keep in the company and in the region for a minimum period of 3 years (SMEs) or 5 years (Non-SMEs) the assets object of the investment;
  Not be liable to the State and Social Security for any taxes or contributions, or have their payment duly assured.

  Companies in difficulty are not considered under the terms of the Commission communication.

  Make a relevant investment that provides for the creation of jobs and their maintenance until the end of the minimum maintenance period of the investment object.

• Relevant Applications

  Relevant investments are considered to be investments related to exploration by a company.

  Tangible fixed assets, acquired as new, with the exception of:
  Lands, except in the case of use for mining concessions, natural and spring mineral waters, quarries, clay pits and sand pits in extractive industry projects;

  Construction, acquisition, repair and expansion of any buildings, unless they are manufacturing facilities or allocated to administrative activities;

  Light passenger or mixed vehicles;

  Furniture and comfort or decoration items, except for hotel equipment for tourist purposes;

  Social equipment, with the exception of those that the company is obliged to have by legal determination;

  Other investment goods that are not directly and essentially associated with the productive activity carried out by the company.

  Intangible assets, consisting of expenses with technology transfer, namely through the acquisition of patent rights, licenses, 'know-how' or technical knowledge not protected by a patent, which cannot exceed 50% of the relevant applications, in the case of subjects IRC liabilities that do not fit into the category of micro, small and medium-sized companies.

• Scope of the RFAI Reduction

  Under the RFAI, companies that meet the eligibility requirements are granted the following tax benefits:
  Collection deduction depending on the eligible region in which the investments are made, namely:
  25% of relevant applications, for investments made in the North, Center and Alentejo regions and in the Autonomous Regions of the Azores and Madeira, up to €15,000,000;
  10% of relevant applications, for investments made in the North, Center and Alentejo regions and in the Autonomous Regions of the Azores and Madeira, exceeding €15,000,000 (in the part that exceeds this amount);
  10% of relevant applications, for investments made in the Algarve, Greater Lisbon and Setúbal Peninsula regions;
  The mentioned deduction is limited to 50% of the IRC collected in each tax period, except in the tax period of the beginning of activity and in the 2 following tax periods (provided that the company does not result from a spin-off).
  The deduction that cannot be made in full due to insufficient collection may be made, under the same conditions, up to the 10th following fiscal year (meeting the aforementioned limit).
  Exemptions or reductions of IMI, IMT and Stamp Tax exemptions may also be granted in relation to the acquisition of buildings that constitute relevant investments.
  The aforementioned tax benefits must respect the maximum limits applicable to regional aid in force in which the investment is carried out.

• Benefit Exclusivity

  The RFAI cannot be combined with any tax benefits of the same contractual nature in relation to the same relevant investments (e.g. SIFIDE), with the exception of the Deduction for Retained and Reinvested Profits (DLRR), provided that the applicable maximum limits are not exceeded.