Car Taxes Guide for Smart Owners

Overview of Vehicle Taxation

In Portugal, vehicle owners are subject to two primary types of taxes: the SV (Imposto Sobre Veículos - Vehicle Tax) and the UC (Imposto Único de Circulação - Single Road Tax). Understanding these taxes is crucial for anyone planning to buy, import, or own a vehicle in Portugal, as they represent significant costs in vehicle ownership.

Vehicle Tax (SV)

The SV is a one-time tax paid when a vehicle is first registered in Portugal, whether it's new or used. This tax is calculated based on two main components: engine displacement (measured in cubic centimeters) and CO2 emissions. For new vehicles, the full tax amount applies, while used vehicles imported from EU countries may qualify for age-based reductions ranging from 10% to 80%. Electric vehicles are fully exempt from SV, and certain plug-in hybrid vehicles registered in the EU between 2015 and 2020 with a minimum electric range of 25km may qualify for a 75% reduction.

Single Road Tax (UC)

The UC is an annual tax that must be paid for as long as the vehicle remains registered in Portugal. Unlike the SV, this is a recurring cost of vehicle ownership. The calculation method varies depending on when the vehicle was first registered:

• Vehicles registered before July 2007 (Category A): Tax based on engine displacement only
• Vehicles registered from July 2007 onwards (Category B): Tax based on both engine displacement and CO2 emissions

UC Payment and Deadlines

The UC must be paid between the first day of the month before the vehicle's registration month and the end of the registration month itself. For newly purchased or imported vehicles, the first UC payment must be made within 90 days of the Portuguese registration date. The payment process is initiated through the Portal das Finanças (Tax Portal), and failure to pay within the specified timeframe results in fines and penalties.

Special Considerations for Imported Vehicles

Since 2020, the rules for calculating UC for imported used vehicles have changed significantly. For vehicles first registered in an EU country or the European Economic Area (Iceland, Liechtenstein, Norway), the original registration date is used for UC calculation purposes. However, for vehicles imported from non-EU/EEA countries (such as Switzerland), the Portuguese registration date determines the tax calculation.

Tax Calculations and Rates

The tax rates for both SV and UC are updated annually, typically in January. For 2025, several factors affect the calculation:

• For SV: Engine displacement, CO2 emissions, fuel type, and vehicle age (for imports)
• For UC: Registration date, engine displacement, CO2 emissions (for post-2007 vehicles), and fuel type Diesel vehicles typically incur higher environmental tax components, while electric vehicles are exempt from both SV and UC.

Exemptions and Reductions

Several exemptions and reductions are available in the Portuguese vehicle taxation system:

• Electric vehicles: Full exemption from both SV and UC
• Classic vehicles (over 35 years old): May qualify for special tax treatment
• Disabled persons: May be eligible for tax reductions or exemptions
• Residents of autonomous regions: May have specific tax benefits Additionally, UC amounts less than €10 are exempt from payment.

Documentation Requirements

To properly calculate and pay vehicle taxes, owners need several important documents:

• Vehicle registration document (Documento Único Automóvel - DUA)
• Technical specifications including CO2 emissions (especially for post-2007 vehicles)
• Proof of first registration date (particularly important for imported vehicles)
• Certificate of Conformity (CoC) for imported vehicles

Impact on Vehicle Ownership Costs

When planning to buy or import a vehicle in Portugal, it's essential to consider both the initial SV cost and the annual UC payments as part of the total cost of ownership. For imported used vehicles, the potential tax savings from age-based reductions should be weighed against other factors such as vehicle condition and maintenance costs. The choice of fuel type, engine size, and emissions level significantly impacts both initial and ongoing tax obligations.

References

• Paying vehicle circulation tax
• UC-2025
• SV-2025