First introduced in 2007 - specifically on 1 July 2007 - the Single Circulation Tax (Imposto Único de Circulação, IUC) replaced three separate charges in one go: the Municipal Vehicle Tax (the well-known “Selo”), the Circulation Tax, and the Haulage Tax.
The idea behind the IUC is straightforward. It acts as compensation for both the wear and tear vehicles cause to infrastructure and the environmental cost associated with their use. It is charged directly on vehicle ownership and is only no longer payable once the registration is cancelled.
The IUC applies to a wide range of vehicles - from cars and motorbikes to leisure boats and even privately used aircraft. As far as cars are concerned, only 100% electric models currently avoid the IUC. The reason is simple: two of the elements used to calculate IUC are engine capacity and emissions - factors that do not exist in purely electric cars.
The IUC categories
There are seven categories in total (A to G). For passenger cars, however, the only ones that matter are the first two: categories A and B.
Category A covers passenger cars first registered in Portugal, in an EU country, or in the European Economic Area between 1981 and the date the IUC came into force - in other words, up to and including 30 June 2007.
Category B includes passenger cars whose first registration date - in Portugal, an EU Member State, or the EEA - is after the IUC took effect. That means all cars registered from 1 July 2007 onwards (inclusive).
How is it calculated?
The IUC is worked out using the tax rates published each year in the State Budget, which vary depending on the vehicle’s category.
For Category A cars, the calculation uses these factors (in bands): fuel type, engine capacity, and registration year. For Category B cars, the formula (also by bands) includes fuel type, registration year, engine capacity, and CO2 emissions.
Let’s do the sums
To calculate the amount of IUC due, you need to check the rates for the relevant category, identify which ones apply, and - for a Category B car - determine both the engine-capacity band and the CO2 band. The following table shows the rates that apply to Category B passenger cars:
| Engine capacity band (cm³) | Rates | CO2 band NEDC | CO2 band (g/km) WLTP | Rate |
|---|---|---|---|---|
| Up to 1250 | 29,39 € | Up to 120 g/km | Up to 140 g/km | 60,28 € |
| More than 1250 up to 1750 | 58,97 € | More than 140 up to 180 g/km | More than 120 up to 205 g/km | 90,33 € |
| More than 1750 up to 2500 | 117,82 € | More than 180 up to 250 g/km | More than 205 up to 260 g/km | 196,18 € |
| More than 2500 | 403,23 € | More than 250 g/km | More than 260 g/km | 336,07 € |
If the vehicle has a diesel engine, there is an additional charge. Introduced in 2014, it varies according to engine capacity:
| Engine capacity (cm³) | Additional rate |
|---|---|
| Up to 1250 | 5,02 € |
| More than 1250 up to 1750 | 10,07 € |
| More than 1750 up to 2500 | 20,12 € |
| More than 2500 | 68,85 € |
For cars registered after 1 January 2017, there is also another additional charge linked to CO2 emissions:
| CO2 band (g/km) NEDC | CO2 band (g/km) WLTP | Rates (euros) |
|---|---|---|
| More than 180 up to 250 | More than 205 up to 260 | 29,39 |
| More than 250 | More than 260 | 58,97 |
Finally, the table below shows the coefficient applied according to the year of first registration:
| Year of acquisition | Coefficient |
|---|---|
| 2007 | 1 |
| 2008 | 1,05 |
| 2009 | 1,1 |
| 2010 and later | 1,15 |
After that… you simply do the maths. Add the engine-capacity band rate to the emissions band rate (and, where applicable, also add the extra charge for vehicles above 180 g/km registered after 1 January 2017); multiply the result by the coefficient for the year of acquisition; then add the diesel additional rate (if applicable) to the final amount.
If that still feels a bit daunting, there is a more convenient option. As you would expect today, there is an online simulator that instantly calculates what you need to pay: impostosobreveiculos.info.
When do you pay, and what happens if you do not?
In general, the IUC must be paid by the end of the month of the registration anniversary shown on the Vehicle Registration Certificate (DUA). The exception is when you pay the IUC for the first time after buying a new car or an imported used car. In that situation, you have 30 days after the registration deadline to pay the IUC.
What happens if you do not pay?
If the owner fails to pay the IUC, the consequence is that the vehicle may be seized or immobilised, along with its circulation documents. This remains in place until the tax due, any fines for non-payment, and all costs related to removal and storage of the vehicle have been settled.
Are there exemptions?
Put simply: yes. The IUC code exempts taxis, classic cars, and firefighters’ vehicles from payment. If the vehicle owner has a disability rating equal to or above 60%, they are also exempt, and there is a further exemption whenever the amount due is less than 10 euros.
Sources: impostosobreveiculos.info; E-Konomista.
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