Does it make sense to spend money on a PPR just for the IRS? In a simplistic answer, I would say clearly yes. imagine a term deposit that earns you 20% “clean”🇧🇷 It would be good? It wouldn’t be good, it would be great! Basically, the taxation of PPR allows you to make this simple calculation. This is not advice for investing in PPR, nor ask me which one you should subscribe to. That’s totally up to you. I just want to get you thinking a little bit. It’s no coincidence that you’re going to start seeing, reading and hearing a lot of PPR publicity before the end of the year. It’s like that every year. But choose your PPR well🇧🇷 There is some who eat all eventual profits in commissions.Another quick warning: if you’re thinking of subscribing to one, do it fast🇧🇷 There are tens of thousands of Portuguese already doing it and, if you leave it for the last week of the year, – with the holidays – you run the risk of something slipping and it is enough for the order to be given on January 1st that the deduction has already been lost🇧🇷 You have the whole year, why is everyone waiting for the end of December? Is it because they only now receive the Christmas subsidy? Or could it also be a lack of planning? I don’t know. Plan your finances in advance to make the most of your money. Also read: Guide on PPR: No more questions about Retirement Savings Plans
How does the IRS deduction work?
According to the Law, you can deduct it from the IRS to be delivered next year (relative to this year) 20% of the amount you invest now until the end of the year🇧🇷 Obviously, you have to make withholdings and have maximum limits on these deductions. In short, these are the bills: If you are already retired, you can do a PPR anyway, but no longer deducts anything from the IRS.Just to have a comparison term, if you had a term deposit yielding 0.2%, you would have to have 200,000 euros there to receive around 300 euros net. With 2,000 euros and less than 35 years old, you would get much more than that from the IRS, just by investing that amount in a PPR (any one). Also read: What are the penalties for redeeming my PPR before the deadline?
The taxation of PPR
Retirement Savings Plans also have a very favorable taxation and unknown by many Portuguese. Taxation on capital gains is calculated only at the time of reimbursement, and benefits from a very reduced rate, if you keep your investment for at least 5 years, or even lower if you keep the PPR for 8 years (8%). Other savings products have a redemption tax of 28%. In addition to this advantage, it is important to know that, in the case of Retirement Savings Plans, tax is only applied on redemptionallowing the capitalization of interest and earnings until the moment of the withdrawal of the applied values. Attention that, when receiving the deduction in the IRS, if you redeem your money without being within the legal requirements, will have to return the deduction, plus 10% of that amount for each year that has passed🇧🇷 That would be a bad deal for you. You can withdraw the money at any time without penalty if you become unemployed for a long time, sick (or a direct relative), a child enters higher education and to pay the mortgage payment (after 5 years). And, from time to time, governments allow exceptional situations to raise certain amounts, like now because of the Euribor rise and high inflation. In short, if you have money available seriously consider subscribing to a PPR in these remaining days of 2022🇧🇷 This is what is called making money with your money. Also read: PPR: In 2023 you can redeem up to 5,744.40 euros without penalty 
Pedro Andersson was born in 1973 and fell in love with journalism as a teenager, at Rádio Clube da Covilhã. He graduated in Social Communication at the University of Beira Interior, and began his professional career at TSF. In 2000, he was invited to be one of the founding journalists of SIC Notícias. Currently, he continues at SIC, as a coordinating journalist, and has been responsible since 2011 for the heading “Contas-Poupança”, dedicated to personal finances. He tries to bring the reality of everyday life to the reports he makes.