Portugal › Municipalities › Melgaço

Melgaço — IRS Municipal Rate 2026

Melgaço retains the full 5% IRS participation share, giving residents no municipal credit against their IRS bill.

Resident credit

0.0%

of IRS base

Retained by municipality

5.0%

of IRS base

Legal ceiling

5.0%

Lei 73/2013

How municipal IRS participation works

Under Lei 73/2013, each of Portugal's municipalities votes annually on how much of the 5% IRS participation ceiling to retain. The share they do not retain is returned to residents as a credit against their IRS bill. A municipality retaining 0% gives residents the maximum 5% credit; one retaining 5% gives residents nothing.

The credit is applied after calculating your IRS liability using the standard brackets and deductions. It is based on your IRS base (tax before credits and surcharges) — not directly on your gross income.

Why municipality matters for your IRS

Your tax residence address on 31 December determines which municipality's rate applies to your entire year's IRS. AT uses the address registered in your Modelo 3 (annual IRS return). To benefit from a lower-retained-rate municipality, you must be officially registered there as your tax residence — not simply own property or occasionally stay there.

The credit is automatically calculated by AT when you file Modelo 3 — there is no separate application required. Simply ensure your registered address is correct.