Portugal VAT rate and bad debts
- Nov 9, 2014 | Richard Asquith
The Portuguese VAT regime is being modified following the 2015 budget. The changes include:
- Exhibition fees are to be included in the base for the calculation of VAT of advertising services. This follows a recent ECJ ruling.
- The VAT exemptions on goods in circulation has been restricted to assets on only.
- The VAT exemption on medical and related health and cleaning services has been withdrawn. Such services will now be subject to the reduce VAT rate.
- The procedures for reversal of output VAT declared on subsequent bad debts has been modified. Companies claiming credits for such debts are now required to instruct their customer of the details of the invoices concerned, and pending legal actions and the tax amounts. Vendors must also inform the tax office where debts are sold as part of a factoring process.