IUC 2027: what is actually changing?

Payment of the Single Circulation Tax (IUC) will undergo important changes starting in 2027. The Government’s proposal was approved in general terms by the Assembly of the Republic and promises to simplify the process, reduce the number of fines for late payment, and ease the financial burden on families.

After so much discussion about the IUC, what will actually change in 2027?

One fixed month for everyone!

One of the main new features is that the IUC will no longer be paid in the vehicle’s registration month. Currently, each owner must keep track of the specific month in which the car was registered, which often leads to forgetfulness and, consequently, fines.

Under the new regime, payment will be concentrated in the month of April, bringing greater predictability and organization for taxpayers.

Payment in installments

Another relevant change is the possibility of paying the IUC in installments, depending on the amount of tax:

• A single installment in April, when the amount is equal to or less than €100;

• Two installments, in April and October, when the amount is more than €100 and up to €500;

• Three installments, in April, July, and October, when the amount exceeds €500.

This measure aims to facilitate household budget management, especially for those who own more than one vehicle.

Transitional regime before 2027

Although the new model will come into force in 2027, there will be a transitional period for adaptation. In the transition year, taxpayers will pay:

• One installment in October, if the tax is equal to or less than €500;

• Two installments, in July and October, if the amount exceeds €500.

The goal is to give citizens time to learn about the new rules and adjust to the new schedule.

Fewer fines, more predictability

According to the Minister of State and Finance, Joaquim Miranda Sarmento, this change does not represent any increase in the tax. The intention is to simplify and reduce unintentional non-compliance.

Over the past five years, more than five million administrative offense proceedings were recorded, and €103 million were paid in fines related to delays in IUC payment. Since 2020, there have also been 5.6 million administrative offense proceedings and 1.8 million tax enforcement actions due to non-payment or late payment.

A large part of these situations simply results from forgetfulness, as the current model spreads payment dates throughout the entire year.

With these changes, a clearer, more organized system aligned with the reality of Portuguese families is expected.

If you own a car, or more than one, it is worth taking note of these changes. 2027 may seem far away, but when it comes to taxes, being informed makes all the difference.

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Source: portugal.gov.pt