IRS 2024: Qual a diferença entre os escalões e as tabelas de retenção?

IRS 2024: What is the difference between the brackets and the withholding tables?

The Tax Authority (AT) has clarified the difference between the tax brackets and IRS withholding tables, so that taxpayers can better understand the tax they contribute to. Also, it is important to remember that in 2024, the bracket limits will be updated.  

13 Dec 20234 min

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Looking to start 2024 with balanced savings? Contact Poupança no Minuto and find out how you can save with your credit and/or insurance portfolio. But first, understand the differences in IRS withholding tax brackets.

What is the difference between tax withholding brackets in IRS?

To understand how much is deducted, you must first understand the difference between the tax brackets and IRS tables and the impact of IRS deduction on your budget, especially in 2024, with the update of the brackets.

According to what the Tax Authority (AT) clarified on their Facebook social network, "the retention tables indicate how much we will deduct monthly from IRS, according to the monthly salary and personal situation", unlike the IRS brackets that "indicate the rates applied for each income range and are used to calculate the tax due for the year".

Note that the income tax brackets in 2024 will undergo a 3% update and the rates of the first five brackets will decrease, as indicated in the new State Budget presented for the next year.

With these changes, the limit of the first bracket of taxable income will increase from 7,479 euros to 7,703 euros, and the rate will decrease from 14.5% to 13.25%.  

At the same time, the limit for the second and third tiers increases from 11,284 and 15,992 euros to 11,623 and 16,472 euros, respectively. In these cases, the tax rate for these tiers decreases from 21% to 18% in the second tier and from 26.5% to 23% in the third tier.  

The second and third levels are, thus, those that register the highest decrease in applied rates - 3 and 3.5 percentage points.

In 2024, increasing savings could be easier.

Not only will Portuguese citizens have a higher income appreciation in 2024 with the smallest IRS discount, but also with other measures provided by the Government in the State Budget and others already in place. income appreciation

Currently, the Government has been focusing its efforts on supporting housing for the Portuguese, launching measures such as fixing and reducing the house installment for two years, interest rate bonuses on the same loan, among others.

However, it is necessary to always pay attention to the small print of these measures, as most include underlying conditions that may not deem the taxpayer eligible to apply or may not be beneficial in the long run.

For example, if you fix your monthly payment with the Government's measure, you may have to reimburse the unpaid amount in these two years, after four years, and with added interest.  

Therefore, regarding mortgage credit, you should know that there are other solutions for fixing the interest rate without having to repay differential amounts later: such as changing your rate to a fixed or mixed interest rate regime. This option is possible by adhering to the new campaigns being promoted by banks, for new acquisitions or transfers.  

Therefore, if you are not satisfied with the current conditions of your credit at the bank where you contracted it, because in case of variable rate you find yourself with a rate around 4%, look for other proposals in different banks. There are institutions offering mixed rates starting at 3%, which can result in significant savings.

If you want to study this option in your specific case, turn to Poupança no Minuto for a free credit brokerage service. We perform simulations, present different proposals, and help you compare and decide on the best conditions for you! In addition to handling all mediation, communication, and paperwork with the banks... Contact us if you want to know more information, here.

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