Third Sector: new tax rules for ETS starting in 2026
June 17, 2025
When it starts
For calendar-year entities, the new rules apply from 1 January 2026. With different year-ends, they start on the first day of the following period (DL 84/2025).
What changes in practice
- Non-commercial test: a clearer test to determine when revenues are treated as non-commercial, helping entities keep the right tax status (CTS, Art. 79).
- Simplified lump-sum regimes: easier tax calculation for non-commercial entities using predefined percentages on revenues (CTS, Art. 80).
- ODV/APS regime: an additional simplified path for volunteer organisations and associations for social promotion, with lower percentages and VAT reliefs under a revenue threshold (CTS, Art. 86).
- Social enterprises: profits reinvested in activities and equity are exempt from corporate income tax, if the rules are met (Leg. Decree 112/2017, Art. 18).
What is still pending
Some financial instruments and incentives are not active yet; they will require further measures (CTS, Art. 77; Leg. Decree 112/2017, Art. 18(3) et seq.).
What to do now (practical, non-technical)
- Review activities and fees to check the correct tax status (CTS, Art. 79).
- Test the best option between the simplified regimes, including VAT/admin impacts (CTS, Arts. 80 and 86).
- For social enterprises: set a clear policy to track reinvested profits (Leg. Decree 112/2017, Art. 18).
- Update by-laws and internal rules where needed (DL 84/2025; CTS).
