November 2026 IRS: who gets half withholding?

If you are tax resident in Mainland Portugal or the Azores, have IRS withheld under the tables and are not in your table's top bracket, November 2026 payments have half the normal withholding. This may increase your take-home pay. The rule includes a Christmas bonus paid in November. In December the normal tables apply again.

How to estimate the difference

Look at the IRS withheld on your payslip.

The 200€ is an example. The rule applies to normal table withholding calculated for the November payment. Half the IRS on an earlier payslip is only an estimate if taxable remuneration, tax circumstances and the applicable table are unchanged. Check that you are tax resident in Mainland Portugal or the Azores and outside the top bracket.

Christmas bonus withholding is calculated separately from salary (IRS Code, Art. 99-C(5)). Do not add the two amounts together to choose the table.

The order only changes IRS withholding. It does not change your Social Security contribution.

Why this is happening

The orders' preambles link the measure to the reduction in IRS rates for the first six brackets, effective from 1 January 2026. The Government explains that lower withholding brings that benefit forward, including the effect of withholding since the start of the year. But the rate cut is not in force yet. Law no. 64-B/2026 of 22 October only authorises the Government to make it, by decree-law, within 180 days. The law does not say from when the cut applies.

This does not mean your annual tax is halved. The 50% cut concerns the amount withheld on eligible November payments.

The legal basis is Art. 99-F(1) of the IRS Code. The Mainland order was published on 14 October 2026 and the Azores order on 15 October. Both take effect from 1 November 2026 (no. 10).

The payment day is what counts

What matters is when income is paid or made available, not just the month shown on the payslip. For Mainland or Azores residents covered by the measure:

• October salary paid on 2 November: half withholding.
• November salary paid on 30 November: half withholding.
• November salary paid on 1 December: normal withholding.
• Christmas bonus paid in December: normal withholding.

If your salary usually lands in the first days of the month, the cut may show up in your October salary.

Exceptions and territorial scope

• Top bracket. If your monthly income is above the upper limit of the second to last bracket of your table, withholding stays the same (no. 3). This is the highest income group.
• Zero withholding. For example, Mainland Table I has a 0% rate up to 920€ a month. The limit varies by table and tax circumstances. Anyone already at zero withholding gets no extra pay from this measure.
• Azores. The Mainland order does not apply (no. 4). The Azores have Order no. 12610-A/2026, with the same 50% rule and the region's own tables.
• Madeira. Neither of these orders covers Madeira residents. This guide does not confirm an equivalent regional cut. Consult AT-RAM and ask your employer to identify the regional legislation it applies; do not automatically use the Mainland rule.
• Non-residents. The order only covers holders resident in Portuguese territory (no. 4).

What about December?

From 1 December 2026 the normal tables apply again, with no cut (nos. 7 and 9). You can only compare net pay with earlier pay if remuneration, tax circumstances and other deductions are unchanged. The employer may still correct an incorrect November withholding in December (nos. 8 and 9).

It is not a mistake. It is the end of the measure.

If your employer does not apply the cut

1. Check the payment date, tax residence and applicable table.
2. Ask payroll for normal withholding on that payment and the 50% adjustment if you qualify. The same withholding as October does not, on its own, prove an error.
3. Show Order no. 12523-A/2026 for Mainland Portugal or no. 12610-A/2026 for the Azores.

The order says the employer may correct the withholding in the following months, until the end of December 2026 (no. 8).

[Depends on the case:] if it is not corrected, the extra IRS withheld is not lost. It goes into the settlement of your 2026 annual IRS return, which you file in 2027.

Your 2027 refund

The order itself explains that withholding aims to bring the tax withheld close to the tax due in the annual return.

[Depends on the case:] IRS Code Art. 78(2) and (3) provides for advance payments to be credited against annual tax and any excess refunded. With final tax and other advance payments unchanged, less withholding reduces the refund or increases the amount payable. This is not a prediction of your 2027 settlement: final tax depends on your 2026 income and deductions.

See also

• Payslip in Portugal: how to read each line
• Christmas bonus in Portugal 2026: how much and when

This guide is for information only and does not replace legal or tax advice for your specific case.