[responsive_menu_pro]

VAT Returns & Recovery in Portugal

  • Following a PT VAT number application, periodic VAT returns for Portuguese sales must be made and monthly VAT returns must be submitted electronically to Portuguese VAT authorities.
  • Input tax paid on goods and services purchased for business operations can be recovered by a taxable person. In most cases, a taxable person recovers input tax by subtracting it from the output tax levied on the supply made. 

vat guide portugal

VAT Returns in Portugal

Frequency

Monthly VAT returns must be submitted electronically to Portuguese VAT authorities before the 10th of the month following the month, and quarterly VAT returns are due on the 15th of the month following the quarter in which the tax liability arose.

The amount of VAT normally due has the same deadline as the VAT return. However, with the amendment of the Portuguese VAT, taxpayers now have an additional five days to transfer the money to the bank account of the Portuguese Authorities. VAT payment for monthly returns is on the 15th of the second following month. As for the quarterly VAT payment must be paid before or on the 20th of the second following month.

Corrective returns

Corrective returns previously submitted on paper must be filed by filing a new return with the word “corrective” in the subject line. For the users of e-filing, a corrective Intrastat return must be filed online.

Selling in Portugal?

We offer an end to end VAT Compliance package

VAT Recovery in Portugal

VAT levied on products and services delivered in Portugal, VAT paid on items imported into Portugal, VAT self-assessed on intra-Community acquisitions of goods and services, and reverse-charged services are all examples of input tax. 

 

During an input tax claim assessment, the tax authorities will ask for a legitimate tax invoice or customs document. 

 

Non-deductible Input Tax 

On purchases of products and services that are not used for business purposes, input tax may not be reclaimed (for example, goods acquired for private use by an entrepreneur). In addition, some company expenses may not be eligible for input tax refunds. 

 

Partial exemption 

In most cases, input tax directly connected to exempt supplies is not recoverable. If a taxable person in Portugal makes both exempt and taxable supplies, it may not be able to recover input tax fully. Exempt with credit supplies are classified as taxable supplies for these reasons, which is referred to as “partial exemption. 

 

Refunds 

The taxable person has an input tax credit if the amount of input tax recovered in a monthly period exceeds the amount of output tax due in that period. In rare cases, a credit return may be requested. If a refund is not available, the input tax credit can be carried forward and used to balance output tax in the future. 

 

If the credit balance is at least EUR 250 and the taxable person has been in a credit position for twelve months or longer, a refund may be claimed. If the VAT credit exceeds EUR 3.000, a VAT refund can be requested right away. 

 

If any of the following circumstances arise, a refund for payments larger than EUR 25 may be sought before the conclusion of the 12 months: 

 

  • The taxable person has stopped doing business.
  • The taxable person has stopped making taxable supplies and solely makes VAT-free goods.
  • The taxable person begins to employ the retailer’s unique VAT accounting regime.

 

VAT refunds for foreign entities  

VAT paid by enterprises that are neither established nor registered for VAT in Portugal is refunded by the Portuguese VAT authorities. Non-established enterprises have the same right to claim Portuguese VAT as VAT-registered firms. 

 

Non-EU businesses 

Refunds are granted under the EU 13th Directive and the terms of Decree-Law no. 186/2009 of August 12 for firms based outside the EU. 

Portugal follows the reciprocity principle, which means that the claimant’s home nation must likewise give VAT refunds to Portuguese enterprises. 

  • A tax representative with a Portuguese address must be designated and given the authority to fulfil all duties deriving from the refund request. The representative submits the request to the VAT Refund Services in writing or electronically. 
  • Filing a certificate from the state in which it is based confirms that it is subject to a general sales tax and confirmation from that state on the reciprocity of treatment for taxable persons based in Portugal. If the two nations have a reciprocity agreement, this certificate cannot be presented. 

Last Updated: 17/01/2022

Disclaimer

The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax

Interested in Portuguese VAT news?

Subscribe to our Newsletter

Download the Portuguese VAT Guide

* By downloading the guide you agree to subscribe to GVC’s monthly VAT newsletter

Contact GVC for your Portuguese VAT Compliance

SUBSCRIBE TO GLOBAL VAT NEWSLETTER

Get the latest VAT information directly in your inbox and stay up to date with all VAT developments around the world.

You have Successfully Subscribed!

download dac7 report

Free Download - DAC7 Report

New DAC7 reporting obligations for online platforms and marketplaces came into effect! Learn all about it in our DAC7 report

You have Successfully Subscribed!