Englobamento — inclusion in the overall base

Some income in Portugal is by default taxed at a flat rate of 28% (separata) — separately from progressive brackets. Englobamento is a voluntary choice: asking AT to include this income in the overall pool and apply the progressive scale.

Which categories can choose englobamento

Category	Description	Separata rate	With englobamento
Cat. E	Dividends, interest, royalties	28%	Progressive rate (14.5%–48%)
Cat. F	Real estate rental income	28%	Progressive rate
Cat. G	Capital gains (shares, crypto, real estate)	28%	Progressive (for real estate — 50% of gain)

When is englobamento beneficial?

✓ Beneficial if your marginal rate < 28%

Example: total income €12,000, marginal rate 21%. Dividends €2,000: separata = €560, with englobamento = €420. Saving €140.

✗ Not beneficial if rate ≥ 28%

Example: total income €35,000, marginal rate 35%. Dividends €2,000: separata = €560, with englobamento = €700. Overpay €140.

How it works

Englobamento choice is voluntary and made when filing (IRS Model 3).
The choice is made per whole category — you cannot include only part of the dividends.
With englobamento Cat G for real estate only 50% of the gain enters the base — the benefit is preserved (CIRS Art. 43 n.2).
Under NHR status, foreign Cat E/F/G are usually exempt (isenção) — englobamento does not apply to them.
Withheld tax (retenção na fonte) is credited in any case.

Calculation example

Scenario	Dividend tax	Total IRS
Salary €30,000 + dividends €5,000, separata 28%	€1.400	€4.300 + €1.400
Same, with englobamento (rate 35%)	€1.750	€5,750 (higher)
Salary €10,000 + dividends €5,000, separata 28%	€1.400	€650 + €1.400
Same, with englobamento (rate 21%)	€1.050	€1,700 (lower)

⚠ Always calculate both options. IRS Clarity simulator automatically calculates all combinations and shows them in the Results section.