Portugal – application of the 0% VAT rate to certain basic necessities
Country Briefs
Portugal
25 April 2023
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Whether you’re a European or non-European company, establishing certain activities in Portugal may mean you need to register for VAT. You can use a fiscal representative or tax advisor to draw up your VAT, Intrastat and ESL returns with total peace of mind in Portugal.
If you deal with companies in Portugal, you may be able to claim a Portuguese VAT refund.
In this VAT guide, we have brought together the specific features of the Portuguese regulations, which interact with the harmonized framework within the European Union.presented in our guide to intra-Community VAT obligations.
With EASYTAX, be 100% VAT compliant, always.
Basic information |
|
|---|---|
| EU membership | 1986 |
| ISO code | PT |
| VAT introduced in Portugal | 1986 |
| VAT name in Portugal | Imposto sobre o valoracrescentado (IVA) |
| VAT ID format in Portugal | PT999999999 |
| Territories with special status in Portugal | n/a |
VAT rates in Portugal |
|
| Standard VAT rate | 23 % |
| Reduced VAT rate (1) | 13 % |
| Reduced VAT rate (2) | 6 % |
| Super reduced VAT rate | n/a |
| VAT parking rate | 13 % |
| Zero VAT rate | yes |
Thresholds triggering VAT reporting obligations in Portugal |
|
|---|---|
| Intrastat threshold at introduction | 350 000 EUR |
| Intrastat threshold on dispatch | 250 000 EUR |
| Distance selling threshold | As of 1st July 2021, the threshold is EUR 10,000 for all intra-Community distance sales. |
Reporting frequency in Portugal |
|---|
| Intrastat return | monthly depending on threshold |
|---|---|
| EC Sales List (ESL) return | monthly according to threshold/conditions, quarterly depending on threshold/conditions |
| VAT returns | monthly depending on threshold, quarterly depending on threshold/for certain services, annually |
|---|---|
| Reporting currency | EUR |
VAT-related penalties in Portugal |
|
| Failure to file a VAT return | A fine of 300 euros to 7500 euros depending on the infraction |
| Late payment of VAT | A fine between 50 euros and 165,000 euros depending on the offence. Annual late payment interest rate of 4.705%. |
| Failure to report ESL/DEB | A fine of 300 euros to 7500 euros per ESL declaration. |
Useful links on VAT in Portugal |
|
| Tax Administration in Portugal | Tax authorities |
| Ministry of Finance in Portugal | Ministry of Finance |
| Check a VAT number in Portugal | Check a VAT number |
| EU VAT Guide | EU VAT Guide |
|---|
Need VAT assistance in Portugal? Contact us now.
A foreign company carrying out transactions in Portugal subject to Portuguese VAT, may be required to appoint a tax representative. Established in Portugal, the fiscal representative will fulfill the company’s VAT obligations to the Portuguese tax authorities on its behalf: filing VAT returns, paying VAT, claiming VAT refunds and carrying out tax audits.
Even when the appointment of a tax representative is not mandatory, a company may entrust the management of its VAT obligations to a tax agent. The difference between an agent and a tax representative essentially concerns the operator’s degree of responsibility. At EASYTAX, we will in any case use the term “tax representation”.
To secure your operations, lighten your company’s administrative burden, and control tax risks in Portugal.
Intra-Community and Portuguese VAT regulations are complex and subject to frequent changes. Declaratory obligations are recurrent and vary in frequency. Penalties for default or delay, as well as errors in flow assessment, can quickly prove financially onerous.
Don’t take risks, don’t pull your hair out: leave the management of your VAT obligations to specialists.
Discover a simple, reliable and efficient tax representation service. EASYTAX handles all your VAT obligations, Intrastat, ESL, and your VAT recovery claims in Portugal, in all European Union countries and certain non-EU countries. You have access to a dedicated consultant, who monitors your file and answers any questions you may have.
Need a tax representative in Portugal? Contact us now.
The VAT rates currently in force in Portugal are as follows:
Need a tax representative in Portugal? Contact us now.
Do you need a VAT fiscal representative in Portugal? Certain operations may require VAT registration and the filing of VAT returns in Portugal:
To check whether your activities give rise to VAT obligations in Portugal, use our VAT simulator .
Need a VAT tax representative in Portugal? Contact us now.
In Portugal , as in other European Union countries, e-sellers must register for VAT:
In addition to VAT registration, e-traders must:
Find out more:
Need a VAT tax representative in Portugal? Contact us now.
You may need a VAT number in Portugal to fulfil your tax obligations in this country. Indeed, certain activities such as sales, purchases and subcontracting operations may require VAT identification.
Portuguese VAT is named Imposto sobre o valoracrescentado (IVA)and the VAT numbers in Portugal have the following structure: PT999999999.
The administrations in charge of VAT in Portugal are the following: Tax authorities, Ministry of Finance.
VAT identification is a relatively simpler formality than setting up a company, but beyond obtaining a VAT number in Portugal, you’ll need to complete and submit periodic declarations to ensure your VAT compliance. Which is why we recommend foreign companies use a fiscal representative or tax advisor.
To check if your activities require VAT identification in Portugal, use our VAT simulator or contact us.
Companies with a VAT number in Portugalmust complete and file dVAT decl arations in Portugal detailing all taxable income (sales) and expenses (costs), at regular intervals:monthly depending on threshold, quarterly depending on threshold/for certain services, annually.
Failure to comply with the deadlines imposed by the Portuguese authorities for the deposit and payment of VAT will result in the payment of penalties . For this reason, it is recommended that foreign companies use the services of an agent or a tax representative.
These penalties are defined as follows in Portugal:
Need VAT assistance in Portugal? Contact us now.
In addition to VAT returns, companies may be required to provide the Portuguese authorities with Intrastat & EC Sales List returns:
Our tax representation services enable you to fulfill all your VAT obligations in all countries of the European Union and beyond. Contact us today.
In principle, a non-resident company in Portugal can recover all or part of the VAT incurred on its expenses.
There are three possible scenarios:
Rely on our VAT recovery services in Europe. Contact us today.
*This information is subject to change without notice.
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