International Business Centre of Madeira
A 5% corporate tax rate, fully inside the EU
Run your company through Madeira's EU-approved International Business Centre, a regime with Europe's lowest corporate tax rates.
What is the Madeira IBC?
A legitimate EU tax regime, not an offshore loophole
The International Business Centre of Madeira (Centro Internacional de Negócios da Madeira, or CINM) is an EU-approved tax regime in place since 1987. Licensed companies pay 5% corporate income tax on eligible income, against Madeira's standard 13.3% and mainland Portugal's 19%, while remaining an ordinary Portuguese and EU company for every legal purpose.
5% corporate income tax
A reduced IRC rate on income earned with non-resident clients and other companies licensed inside the regime.
No withholding on distributions
Full exemption on dividends, interest and royalties paid to non-resident shareholders and partners, outside blacklisted jurisdictions.
Treaty and directive access
Portugal's double-taxation treaty network, plus the EU Parent-Subsidiary and Interest and Royalties Directives.
Participation exemption
Qualifying holdings are exempt on dividends and capital gains, making Madeira an efficient base for holding structures.
Duty and stamp exemptions
Exemption from property transfer tax (IMT), stamp duty and a range of local levies tied to activities within the IBC scope.
Transparent by design
Real substance and reporting requirements, recognised by the OECD, give structures based here lasting credibility.
Who it's for
Built for internationally active businesses
The regime suits companies whose income is generated with non-resident clients or other IBC entities. Work carried out with mainland-Portuguese, non-IBC companies is taxed at the standard rate, so structuring matters, and it's where our advice pays for itself.
Requirements
Two routes to qualify
Your company must be licensed with the IBC and meet one of the two substance requirements below within its first six months of activity. The jobs created must be filled by workers who are tax-resident in Madeira.
Jobs plus investment
- Create 1 to 5 jobs in the first six months of activity, and
- Invest at least €75,000 in tangible or intangible fixed assets within the first two years.
Jobs only
- Create 6 or more jobs in the first six months of activity.
- No minimum investment threshold applies under this route.
Timing: licensing under the current regime closes on 31 December 2026, and companies licensed in time keep the 5% rate until 31 December 2027. Income above the annual ceiling set by your job count is taxed at the standard rate. For the detail behind each requirement, read our IBC Madeira guide.
How we help
From first assessment to ongoing compliance
Conta Plena manages the entire lifecycle, so you deal with one team from day one.
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Assessment
We review your activity, clients and structure, confirm eligibility and model the effective tax position.
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Licensing
We prepare and submit the IBC licence application and handle the approvals needed to operate.
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Incorporation
We form the company, register it for tax and social security, and plan the job and substance milestones.
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Accounting
Bookkeeping, payroll, VAT and OCC-certified reporting keep your benefits secure year after year.
Frequently asked questions
Madeira IBC, answered
It is a European Commission-approved State-aid measure, first endorsed in 1987 and regularly re-authorised since. It is recognised by the OECD and is not a blacklisted jurisdiction. Companies licensed here are ordinary Portuguese and EU entities, carrying the same substance, accounting and reporting obligations as any other.
No. Shareholders and directors can be resident anywhere. The substance requirements apply to the company rather than its owners: the jobs you create must be filled by workers who are tax-resident in Madeira, and the company needs a genuine operating presence on the island.
The standard Portuguese set: OCC-certified accounting, payroll and social security, VAT returns where applicable, and annual corporate filings. On top of that, you evidence that the job-creation and investment conditions are being met, since the 5% rate depends on them. We handle all of it in-house.
From 1 January 2026 the guaranteed regional minimum wage is €980 per month, paid across 14 payments a year. It sits above mainland Portugal's €920, and employer social security contributions apply on top of gross pay. We factor both into any staffing plan and quote.
Usually yes, though it depends on your country of tax residence. Portugal takes part in the OECD's Common Reporting Standard, so account details are exchanged automatically with your home tax authority each year, and many countries also require you to declare foreign accounts on your annual return. Confirm the position with an adviser at home, and we will coordinate with them.
Request a quote
Tell us about your business
Share a few details and our team will prepare a tailored quote covering licensing, incorporation and ongoing accounting for your Madeira IBC company. No obligation, just clear numbers.
- Funchal, Madeira
- geral@contaplena.pt
- +351 938 023 952