The Limitation of Interest Deduction and the Tax Treatment of Groups: Time for a Change in Portugal?

Council Directive 2016/1164 (ATAD) states that if a taxpayer is a member of a group, then it may be given the right to fully deduct interest expenses if its ratio of equity over total assets is equal to, or higher than, the equivalent ratio of the group. The Portuguese limitation rule does not provide this option, relying instead on an EBITDA-based clause. This article advocates for a change.

Authors

Publication Details

Journal
Bulletin for international taxation
Published
2025-08-27
DOI
https://doi.org/10.59403/1ar1mkf
Primary Topic
Corporate Taxation and Avoidance
Type
article
Field-Weighted Citation Impact
0.00
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article

The Limitation of Interest Deduction and the Tax Treatment of Groups: Time for a Change in Portugal?

António Martins
Bulletin for international taxation
Corporate Taxation and Avoidance
article

The Limitation of Interest Deduction and the Tax Treatment of Groups: Time for a Change in Portugal?

António Martins
article en

Abstract

Council Directive 2016/1164 (ATAD) states that if a taxpayer is a member of a group, then it may be given the right to fully deduct interest expenses if its ratio of equity over total assets is equal to, or higher than, the equivalent ratio of the group. The Portuguese limitation rule does not provide this option, relying instead on an EBITDA-based clause. This article advocates for a change.

Bulletin for international taxationVol. 79(9/10)
Openalex Percentile: Top 66%
Corporate Taxation and Avoidance
DOISourceOpenAlex
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The Limitation of Interest Deduction and the Tax Treatment of Groups: Time for a Change in Portugal? — António Martins · Bulletin for international taxation (2025) | TGRS Research Map | TGRS