Madeira is an exceptional destination when considering Portugal’s non-resident tax benefits. This Portuguese archipelago combines EU membership with unique tax incentives, making it a powerful hub for global investors.
Why Madeira Offers Unique Tax Opportunities
Madeira is an autonomous region of Portugal, recognised as an outermost region of the European Union. Because of this status, Madeira provides special tax regimes that attract international businesses. Consequently, the area has developed one of Europe’s most competitive investment platforms.
The International Business Centre Advantage
The International Business Centre of Madeira (CINM or MIBC) was created in the 1980s to boost investment and job creation. Since then, CINM has evolved into a strategic solution for companies seeking low tax exposure in Europe. Most importantly, it grants corporations access to a reduced corporate income tax rate of only 5%.
Extended Benefits Until 2026
Portugal extended the deadline for new CINM registrations until December 31, 2026. Therefore, companies still have time to apply and benefit from this regime. Once licensed, advantages remain valid until the end of 2028, offering medium-term certainty for investors.
Madeira’s 5% Corporate Income Tax Rate
The 5% corporate income tax rate is one of the lowest in Europe. In contrast, the standard Madeira corporate tax rate is currently 14%. Hence, companies operating under CINM enjoy significant tax savings, provided they meet local substance and employment requirements.
Additional Tax Incentives for Investors
Madeira’s Free Trade Zone grants more than a low corporate tax rate. Companies can benefit from:
- Up to 80% exemptions on stamp duty and property transfer taxes.Reduced municipal real estate taxes.
- Withholding tax exemptions on dividends and interest for non-residents.
Therefore, Madeira delivers direct and indirect savings, maximising overall investment efficiency.
Industrial Free Trade Zone Benefits
Manufacturing companies in Madeira’s Free Trade Zone gain further advantages. These include import tax suspensions and potential 50% reductions on taxable income, if specific conditions are met. This framework encourages innovation, sustainability, and employment.
Exclusions to Keep in Mind
Not all sectors qualify for Madeira’s regime. Financial services, consultancy, agriculture, and extractive industries are excluded. Thus, investors should always confirm eligibility before applying.
Investment Tax Code Opportunities
Beyond CINM, Madeira’s Investment Tax Code offers additional incentives. Investors may access up to 40% tax credits for productive investments made before 2027. Moreover, generous deductions can benefit research, technology, and environmental projects. This means Madeira supports both traditional and high-value industries.
Why Non-Residents Benefit Most
For those exploring Portugal non-resident tax opportunities, Madeira is highly appealing. Non-resident shareholders enjoy exemptions on dividends and interest from CINM companies. These benefits extend beyond Europe, thanks to Portugal’s extensive double tax treaty network.
Final Thoughts: Madeira as Europe’s Hidden Gem
Madeira should be at the top of the list when weighing Portugal’s non-resident tax strategies. The island combines EU security with one of Europe’s lowest tax rates. Furthermore, extending licensing until 2026 provides investors with a limited window of opportunity. In conclusion, Madeira is a tourist paradise and a robust financial gateway. For non-residents, it offers the chance to minimise taxes, maximise profits, and operate within a secure European framework.
The information provided in this article is for general informational purposes only and does not constitute legal or tax advice concerning Portugal Non-Resident Tax. Although efforts are made to ensure accuracy and timeliness, laws and regulations may change, and the content may not reflect the most recent developments. Readers should not act or rely solely on this information without seeking professional advice tailored to their circumstances. Neither the author nor the publisher accepts any liability for actions taken or not taken based on this content.
The founding of Madeira Corporate Services dates back to 1996. MCS started as a corporate service provider in the Madeira International Business Center and rapidly became a leading management company… Read more
