Income taxes are divided into IRS - Personal Income Tax and IRC - Corporate Income Tax. IRS is responsible for taxing all income obtained by individual taxpayers, such as wages, pensions, self-employment income, rents, interest, dividends, capital gains from real estate and financial assets. IRC applies to income obtained by corporate entities, meaning it taxes the profits of businesses engaged in commercial, industrial, or agricultural activities in Portugal.

IRS/IRC can also apply to both individual and corporate entities with income from real estate in Portugal or engaged in activities with a permanent establishment, depending on whether it's an individual or corporate taxpayer.

Taxes always result from a declarative obligation. The Portuguese tax calendar typically follows the calendar year from January 1st to December 31st, although companies can choose a different fiscal year.

In general, IRS applies to individual citizens who, as residents in Portugal, must declare their entire income in Portugal (both obtained in Portugal and abroad). For IRC, taxation is always based on the location of the company's registered office. However, the location of services provided may require registration in other territories, leading to specific tax obligations when services are rendered outside Portugal.

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