The Interest Portugal Charges on Overdue Tax Has Brought In 131.6 Million Euros in Seven Months, 37 Percent More Than the Budget Set Aside for the Year

Paying the tax office late has become one of the fastest-growing lines in Portugal's public accounts. The Autoridade Tributária e Aduaneira (Tax and Customs Authority) collected 131.6 million euros in late-payment and compensatory interest between January and July, according to the July budget execution report published by the Entidade Orçamental (the Budget Entity, formerly the Directorate-General for the Budget). The state had budgeted 96 million euros for the whole of 2026.

That is 137.1 percent of the full-year forecast collected in seven months, and 45.3 percent more than the 90.6 million euros taken in the same period of 2025. Full-year 2025 came in at 152.5 million, a figure this year will pass comfortably before the autumn is out. The report names the growth in compensatory and late-payment interest, alongside revenue from the Autorização de Residência para Atividade de Investimento (the residence permit for investment activity, better known as the golden visa), as one of the drivers behind an 18.7 percent rise in non-tax, non-contributory revenue.

The contrast within the same table is instructive. Road traffic fines, the other well-known way the state takes money from people who did something wrong, brought in 52.6 million euros to July, down 1.8 percent on last year and running at less than half the annual budget. Ordinary fees fell 2.6 percent. Interest on unpaid tax is doing the work.

Two different charges, two different rates

Portuguese tax law separates them, and the difference is worth several percentage points.

• Juros compensatórios (compensatory interest) are due under article 35 of the Lei Geral Tributária (General Tax Law) when the taxpayer's own conduct delays an assessment or the delivery of tax due, or when a refund is received that was larger than it should have been. They run day by day, are charged at the civil legal interest rate of 4 percent, and are billed together with the tax itself. Crucially, they are capped: 180 days where the error is visible on the declaration, or up to 90 days after an inspection closes.
• Juros de mora (late-payment interest) are due under article 44 when the tax simply is not paid on time, and they run until the debt is paid, with no cap. The rate is the general rate for debts to the state, set annually by the treasury agency. For 2026 it was fixed at 7.221 percent by Aviso 18/2026/2 of 2 January, applicable from 1 January: the 2025 average of the twelve-month Euribor, 2.221 percent, plus the five percentage points that Decreto-Lei 73/99 adds on top.

Two further rules shape the bill. The rate is halved for debts covered by a bank guarantee or by security taken or accepted by the creditor. And it doubles, under article 44, for the stretch between the deadline for voluntarily complying with a final court decision and the day the tax is actually paid: a charge above 14 percent for ignoring a judgment.

What this means for residents

• Late is now expensive relative to almost anything else. At 7.221 percent, tax arrears cost more than most Portuguese mortgages and more than a personal loan at many banks. If you can borrow more cheaply to clear a tax bill, the arithmetic usually favours doing so.
• A wrong return and an unpaid return are not the same problem. An error corrected later attracts 4 percent, time-limited. Non-payment attracts 7.221 percent, uncapped. Filing on time and paying late is a materially better position than not filing at all.
• Citation resets part of the clock. Where a debt is paid within 30 days of the citation in an enforcement process, article 44 counts the interest only up to the date that citation was issued.
• Check before you are asked. Anyone who thinks they may be carrying a balance can confirm it free of charge; our guide to the certidão de não dívida sets out how. If you believe the assessment itself is wrong, the routes are in our guide to contesting a tax assessment, and the enforcement stage is covered in our guide to what happens when a creditor reaches your pay.

None of this is a policy choice. The rate rose because the Euribor rose, and the collection rose because more people fell behind while the rate was climbing. But it does mean the state's own accounts have gained a line that grows when households and firms are under pressure, and the July report shows it growing faster than almost anything beside it.