One of the most significant changes to SIFIDE in recent years occurred in August 2026

For several years, a company could access SIFIDE not only through its own research and development expenditure, but also by subscribing to funds intended to finance companies primarily engaged in R&D.

This was known as Indirect SIFIDE, a model that created a new segment in the Portuguese venture capital market and channelled substantial volumes of private capital towards technology companies and research-intensive projects.

The framework changed in 2026: Decree-Law 170/2026 of 21 August extended Direct SIFIDE to the 2026 financial year, but did not extend the possibility of generating a new tax benefit through contributions to investment funds.

This does not mean that SIFIDE Funds have disappeared, but rather that they have entered a new phase.

How did Indirect SIFIDE work?

Historically, the legislation allowed contributions to investment funds intended to finance companies primarily engaged in research and development to qualify as relevant applications.

For the corporate investor, subscribing to fund units could generate a SIFIDE benefit, subject to the conditions of the scheme.

The fund would then be required to channel the capital to eligible companies and activities. The economic rationale was attractive.

A company with the tax capacity to invest could obtain exposure to a portfolio of R&D companies while benefiting from the tax incentive available under SIFIDE.

But one element was fundamental: the tax benefit assumed that the capital would ultimately be applied to genuine R&D activities.

Why did Indirect SIFIDE end for new investments?

In the 2026 revision, the Government justified the change by pointing to a gap between the tax benefit granted and the effective application of a significant share of the amounts to research and development activities.

The legislation expressly refers to more than EUR 1 billion already placed in funds and not yet invested, and does not extend the indirect model to new contributions.

This is a structural change: from 2026, the incentive once again clearly prioritises companies that invest directly in R&D.

What happens to capital already invested in the funds?

This is where the transitional regime applies: contributions made in tax periods beginning on or before 31 December 2025 remain covered by the transitional rules established in the new legislation.

The funds therefore still need to invest the capital previously raised.

And portfolio companies must continue to demonstrate that those resources are being used for the purposes established by law.

The end of eligible new subscriptions does not remove the responsibilities associated with the existing stock of investment.

The deadlines were extended

One relevant change was to allow more time for the existing capital to reach the economy.

In general terms, the new regime establishes a period of five years for SIFIDE Funds to complete the required investment in companies, and a corresponding five-year period for portfolio companies to demonstrate that the resources have been applied to eligible activities.

However, the regime contains different transitional rules depending on the date when contributions were made.

It is therefore essential to assess each fund and each investment individually.

There is now room for productive innovation

This is probably the most interesting development for companies receiving investment from existing SIFIDE Funds.

The 2026 revision allows part of the investment to be applied to productive innovation arising directly from, and functionally complementary to, R&D activities completed in the previous three years.

The objective is to bring research closer to industrialisation and market launch.

A project may have developed a new technology, process or product through R&D but may still require equipment and productive investment to transform that knowledge into industrial capacity.

Within certain limits, the new regime seeks to enable that transition.

Important limits apply

Investment in productive innovation is not unlimited. Equity investments intended for this expenditure may not exceed 20% of the contributions covered by each SIFIDE Fund. For each portfolio company, an aggregate limit of EUR 20 million applies to this type of investment.

There are also rules concerning the nature of eligible expenditure and a prohibition on financing the same expenses through other national or international public support.

This makes the analysis particularly relevant for companies simultaneously considering Portugal 2030, the Recovery and Resilience Plan or other mechanisms.

The investor still bears tax risk

One feature of Indirect SIFIDE that should never be overlooked is that the tax benefit is tied to compliance with the conditions of the scheme.

The new legislation maintains adjustment mechanisms where the fund or portfolio company does not make the required investments within the established deadlines.

There are also consequences if fund units are sold before the period established by law.

An assessment of a SIFIDE Fund should therefore not be limited to the tax benefit initially recognised.

It is important to monitor:

  • the capital effectively invested;
  • the portfolio companies;
  • the companies' suitability in relation to R&D;
  • project execution;
  • statutory deadlines;
  • the documentation required to evidence that execution.

The end of an incentive may mark the beginning of another phase

Indirect SIFIDE played an important role in mobilising capital for Portugal's innovation ecosystem. The model of new subscriptions carrying a tax benefit has ended, but a very significant volume of capital still needs to be invested over the coming years.

For technology companies and businesses with R&D projects, existing SIFIDE Funds may therefore remain potential investors.

For the funds, finding companies with technically eligible projects and a genuine ability to deploy investment becomes even more important.

And for investors that have already subscribed to fund units, monitoring execution is now more relevant than ever.

At Fenix Capital Partners, we advise on these matters both from the perspective of companies seeking finance and through the assessment of eligibility and the structuring of R&D and investment projects.

Even after Indirect SIFIDE has ended for new investments, a substantial amount of capital still needs to find strong projects.