Portugal VAT

Portugal Value Added Tax was introduced in 1986 as part of the entry of the country into the European Union.  It is termed Imposto sobre o valor acrescentado (IVA).

 


There was a transition period, and the full regime came into force in 1989.  As with all other member states, Portugal is required to follow the EU’s rules on VAT registrations, compliance, returns, Intrastat and EC Sales Lists.  The Portuguese VAT rules are contained within the VAT Code.  It is overseen by the Department of the VAT Service, which is part of the Directorate General of Taxes in the Ministry of Finance.  This issues official Circulars and Decisions in support of the VAT Code.

Foreign businesses importing or trading goods or services in Portugal may be required to VAT register as a non-resident trader in Portugal.  It would then also be obliged to following local compliance, reporting and payment processes.


Should you register for Portuguese VAT?

Portugal requires non-residents to register if the are performing any of the following trading (note – this is not an exhaustive list):

  • Importing goods into Portugal from outside of the European Union
  • Buying and selling goods within Portugal
  • Selling goods over the internet to Portuguese consumers.  This is subject to a local VAT registration threshold
  • Holding goods in a consignment stock warehouse for sale to local customers
  • Charging admission to events or exhibitions
  • If a company is otherwise a non-VAT trader, but is receiving services in the Poland under the reverse charge rule.
  • The self supply of goods.

Portugal changed the rules on VAT registering foreign service providers in 2010.  This was brought on by the EU VAT Package, which reduced the number of situations that required a foreign services trader to register for Portuguese VAT.

Note that providers of electronic, broadcast or telecoms services to consumers in Portugal only have to VAT register in one EU country under the MOSS scheme to file a single return covering all 28 member states.

You can read more about Portuguese VAT on our VAT compliance, VAT registration or other related briefings.


Latest Portuguese news

EU moves new B2C VAT liabilities to marketplaces 2021

December 12, 2018

On 12 December, the European Commission published details of a new rule which would make large online marketplaces responsible for calculating, collecting and remitting VAT on certain B2C cross-border transactions below €150. Where goods are imported by an EU or non-EU merchant, and then sold via a marketplace in another EU country..

Portugal annual VAT return and SAF-T requirements

December 12, 2018

The Portuguese tax authorities have stated that the annual VAT return must be based on tax payers’ Standard Audit Files for Tax (SAF-T) submission....

Portugal live VAT invoice reporting 2019

September 4, 2018

Portugal is to take the first step towards live VAT invoice reporting from 1 January 2019. From this date, all B2G (business to government...