Adjustments to company size criteria

The classification of companies is changing once again.

On 5 December, Decree-Law No. 126-B/2025 was published, transposing Delegated Directive (EU) 2023/2775 into Portuguese law and updating the size criteria applicable to micro, small, medium-sized and large undertakings.

Until now, the applicable thresholds were as follows:

• Micro undertakings: total balance sheet up to €350,000; net turnover up to €700,000; average number of employees: 10;
• Small undertakings: total balance sheet up to €4,000,000; net turnover up to €8,000,000; average number of employees: 50;
• Medium-sized undertakings: total balance sheet up to €20,000,000; net turnover up to €40,000,000; average number of employees: 250;
• Small groups: total balance sheet up to €6,000,000; net turnover up to €12,000,000; average number of employees: 50.

Under the new decree, these thresholds are revised upwards and, in general terms, are now as follows:

• Micro undertakings: total balance sheet up to €450,000; net turnover up to €900,000; the average number of employees remains unchanged;
• Small undertakings: total balance sheet up to €5,000,000; net turnover up to €10,000,000; the average number of employees remains unchanged;
• Medium-sized undertakings: total balance sheet up to €25,000,000; net turnover up to €50,000,000; the average number of employees remains unchanged;
• Small groups: total balance sheet up to €7,500,000; net turnover up to €15,000,000; the average number of employees remains unchanged.

The decree also expressly introduces two additional group categories:

• Medium-sized groups: total balance sheet up to €25,000,000; net turnover up to €50,000,000; average number of employees during the period: 250;
• Large groups: those which, on a consolidated basis, exceed two of the three thresholds applicable to medium-sized groups.

This revision reflects economic developments and the impact of inflation in recent years. In practical terms, the increase in thresholds may allow more companies and groups to remain within lower size categories (micro, small or medium-sized), mitigating the automatic increase of accounting obligations, reporting requirements and compliance burdens driven solely by nominal growth in balance sheets and turnover.

The new rules apply to financial statements for financial years beginning on or after 1 January 2026.

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