Tuition refunds? Young IRS may be more beneficial, says OCC

Until now, young people could accumulate tuition refunds with the IRS Jovem program, but the rules will change for new applications. Paula Franco, president of the Order of Certified Accountants (OCC), states that, if this change is made, it is generally more beneficial to opt for the IRS Jovem program, but warns that it will be necessary to analyze each case individually.

The qualifications-based salary bonus was created by António Costa's government in 2023 to allow young workers, up until the year they turn 35, to request a tuition refund from the state in recognition of their bachelor's or master's degree completion. Until now, this benefit could be combined with the IRS Jovem (Youth Income Tax).

However, the Minister of Education clarified this Tuesday that young people who are not yet benefiting from tuition reimbursement will be able to receive the qualifications bonus, but will have to choose between this support or the IRS Jovem (Youth Income Tax) . " Already approved applications will continue to be paid, as announced on Monday by the Tax Authority. However, for new applications, graduates will be able to choose between the salary bonus and the IRS Jovem (Youth Income Tax) ," said Fernando Alexandre.

This change may be related to the fact that "the IRS Jovem rules for 2025 have changed considerably. They are much more beneficial than the previous rules," since the regime extends up to age 35 and does not require an associated educational degree, said Paula Franco, president of the OCC, during the regular weekly online meeting held on Wednesday. In this sense, the government may have concluded that combining tuition refunds with this measure "would generate extremely high costs."

If the choice is to be made, what is the most advantageous option for young people? "We need to be cautious in this analysis," says the representative of certified accountants. Still, she notes that the "new IRS Jovem rules have very favorable values ​​for young people."

"From what I understand, in general terms, in most situations, you can benefit, especially if it's the first year, which is 100%, with a refund of your income tax, " he says, noting, however, that this "very much depends on salary issues." It's necessary to analyze each case individually.

"For example, if this young person earns a minimum wage and will not receive any benefits in terms of income tax, then they can offset the return of tuition fees," he points out, adding that "only by analyzing each situation will we be certain" which is the best option.