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Portugal introduces VAT cash accounting

  • VAT
  • 18 May 2013 | Richard Asquith

Portugal introduces VAT cash accounting

From 1 October 2013, Portuguese small companies will be allowed to submit VAT returns on a cash-paid basis.  This will help improve their cash flow risks, and is common across much of the rest of the European Union.

Businesses with a turnover below €500,000 per annum can pay their Portuguese Value Added Tax only when they have actually received payment for any invoice issued.  This contrasts with the accruals basis, whereby companies must declare and pay the VAT on their sales invoices even if they have not yet received payment.

The measure is intended to provide an economic boost to struggling small companies.  It will be on offer to over 300,000 businesses.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.