PORTUGAL: COVID-19 VAT IMPLICATIONS

Apr 1, 2020 | COVID-19

PORTUGAL – Update 13rd May

VAT exemption and reduced VAT rates to health-related products on the IC supply and acquisition of goods

  • VAT exemption for purchases made by the Portuguese state, other public entities or non-profit organizations and applies from 30 January to 31 July 2020
  • reduced VAT rate (6% in mainland Portugal) on importation, intra-community supply and acquisition of respiratory protection masks and skin disinfectant gel from May 8 to December 31, 2020

 

Source Credit – Law 13/2020 – May 7, 2020

PORTUGAL – Update 12th May

Law published with VAT measure for the COVID-19

 

Source Credit – gov.pt

PORTUGAL – Update 17th April

The government has passed proposed easements into law including the option to pay VAT by instalments without incurring late payment penalties or interest.

 

Source Credit – Accordance VAT

PORTUGAL – Update 14th April

Mandatory B2G e-invoicing has been postponed to 1 January 2021 for large enterprises

 

Source Credit – DRE

PORTUGAL – Update 9th April

February monthly returns and associated payment delayed

February monthly returns, due on 10 April, are now due by 17 April. The associated payment is not now due until 20 April instead of the current 15 April. There will be no late filing penalties or payment interest charges.Update 31 March – the February monthly return may be delayed until 10 April 2020. This may be based on reported invoices on the Portuguese e-invoice platform without also submitting physical documents and reconciliations. No penalties and interest will be liable on this delay. This is only available for businesses below €10 million.

Portugal has announced a range of payment easements and other support for businesses.In the second quarter of 2020, VAT payments may be paid as follows by businesses with a turnover not exceeding €10 million per annum. This is an automatic option. For businesses with a turnover about this threshold, an application must be made for a delay. The scheme is available to monthly or quarterly taxpayers.

  • Full payment;
  • Three-monthly payments without interest charge; and
  • Six-monthly payments, including late interest on the final three instalments.

 

Source Credit – Richard Asquith (Avalara)

PORTUGAL – update 9th April

Mandatory B2G e-invoicing has been postponed to 1 July 2021 for small and medium enterprises with the announced new measures against the pandemic

 

Source Credit – gov.pt

PORTUGAL – update 7th April

Measures on the payment of VAT and periodic VAT declarations

The payment of VAT (applicable to the normal monthly and quarterly regimes) and of withholding taxes on IRS and IRC , can be made: immediately or in a fractioned way in 3 or 6 monthly installments without interest by taxpayers with a volume of businesses up to 10 million euros, calculated in 2018, or which started their activity as of January 1, 2019 (article 1 and article 2 of Decree-Law no. 10-F / 2020 of 26 March ).For the remaining taxable persons, payment can be made in installments, if they have verified a decrease in the invoicing communicated through the e-invoice of at least 20% in the average of the three months preceding the month in which this obligation has to be fulfilled., compared to the same period last year. (Article 1 and Article 2 of Decree-Law No. 10-F / 2020 of 26 March )

These installment payments are exempt from presenting a guarantee. (Article 1 and Article 2 of Decree-Law No. 10-F / 2020 of March 26 ) 

The periodic VAT declarations , referring to the period of February 2020, to be delivered within the legal period provided for in no. 1 of article 41 of the CIVA, can be calculated based on the data contained in the E-Invoice, and the situation must be regularized by means of a replacement declaration provided that this replacement and the respective payment / settlement occurs during the month of July 2020, based on all supporting documentation, without any additions or penalties. 

Simplification in the fulfillment of this declaratory obligation applies to taxable persons:

  • with a turnover, up to 10 million euros, for the year 2019;
  • who started the activity on or after January 2020; or yet
  • who restarted their activity on or after that date and did not achieve turnover in 2019. ( Order No. 129/2020 – XXII – SEAF )

 

Source Credit – AT

PORTUGAL – Update 31st March 

  • Decree-Law No. 10-F/2020 was published, including:
    • The flexibility of VAT payments and withholding tax on IRS and IRC, to be fulfilled in Q2 of 2020
    • Deferred payment of contributions due by employers and self-employed persons
    • The application to the ongoing benefit plans in the Tax and Customs Authority (TA) and social security (SS) of the regime provided for in Article 7(1) of Law No. 1-A/2020 of 19th March
    • The suspension of tax enforcement proceedings initiated by the TA and the enforcement procedures for social security debts until 30th June 2020, if the regime approved in Article 7(1) of Law No. 1-A/2020 of 19 March ceases at an earlier date

Source Link here

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