Compliance overview | Country updates | Portugal
B2G: Centralised
B2B: Post-Audit
B2G: CIUS PT
FEAP
Required in non EDI e-invoices (PDF, etc.); effective – 1 January 2023
Revisions to Portuguese tax code The turn of 2023 is a busy one for Portugal in fiscal-related matters, as it also has made significant revisions to its tax code. As a summary, these changes include:
An increase in the VAT exemption limit, from 12,500 Euros to 13,500 Euros in 2023
An extension in the deadline for submitting tax returns, which includes an extension to 20 September for the filing of the second quarter VAT returns
A reduction in the VAT rate for vegetable-based drinks and butter, to 6%
A reduction on the VAT rate on biomass equipment, with specific equipment now taxed at 6%.
Tungsten supports all valid VAT rates as part of our e-invoicing solution in Portugal and these are available on our portal for selection.
Mandatory inclusion of the ATCUD code on invoices (miscellaneous) As of 1 January 2023, it is mandatory to include an ATCUD code on a Portuguese invoice. Tungsten has previously commented on the delay of the mandatory implementation of the ATCUD code. As a reminder, the ATCUD is an 8-digit code unique identifier included on Portuguese fiscal documents, and comprises of the following:
A service validation code assigned by the Portuguese tax authorities, and
A series of numbers usually derived from the taxpayers' software.
Tungsten does not create the legal invoice on behalf of suppliers in Portugal. However, we assist Portuguese suppliers and buyers through efficient and rich invoice data delivery to buyers. Portuguese suppliers are advised to include the ATCUD code from 1 January 2023 in their fiscal documents as applicable.
VAT/G(S)ST rate information
Reduction of VAT on purchase of bicycles Increasingly, we are seeing countries advance environmental and health agendas via the deployment of fiscal measures. Such tax measures, ubiquitous in 2022, are expected to be equally commonplace in 2023, as awareness of ecological and related matters increases. Via its 2023 State Budget, Portugal is introducing a reduction in VAT on the purchase of bicycles. In doing so, Portugal becomes the first EU country to enact such a measure. From 1 January 2023, this will be set at the lowest VAT rate possible in Portugal, at 6%. Tungsten supports all valid VAT rates in Portugal as part of its solution, including the 6% rate. We are also conscious of the countries intrinsically linking further societal agendas which extend beyond the economy in their tax agendas, and we are investigating how we can integrate these as part of our solution.
Option to use PDF as e-invoices further extended & other relevant tax changes Order 8/2022-XXIII of the Secretary of State for Tax Affairs, dated 13 December 2022, introduced some amendments to the Portuguese 2023 tax calendar. These revisions have been summarised below:
The possibility to utilise PDFs as e-invoices for tax purposes has once again been extended, now to 31 December 2023, from which point a digital signature will be required on a PDF invoice.*
For any fiscal documents, such as invoices, credit notes, etc issued in 2023, businesses will have until the 8th of the following month to submit the Standard Audit File for Tax (SAF-T). The SAF-T is an internally recognised standard which is used for the exchange of tax information.
Further important points raised in the Order include the following:
The Portuguese Tax Authority (PTA) will promote compliance with the technical specifications necessary for the real-time communication of invoice data, either through webservice in real time, or through a monthly web service.
The PTA will also plan to implement a process to issue supporting compliance alerts to taxpayers who do not communicate the data included in their invoices by the 5th day of the following month, or when applicable.
Annual inventories can be submitted until the second month following the end the fiscal year. Consequently, the annual inventories for 2022 should be submitted before 28 February 2023.
*Tungsten is closely following the requirement for PDF's to be digitally signed in Portugal, especially considering the VAT in the Digital Age (ViDA) proposal which re-defines the definition of an e-invoice, as well as modifying the relevance of digital signatures on a PDF.
VAT exemption codes updated Decree-Law no. 198/2012 in Portugal confirms the obligation to communicate details in respect of invoicing documents. Within this, the Portuguese Tax Authorities (PTA) have updated the list of VAT exemption codes. To accommodate this change, developers and users of invoicing programs must ensure their systems are updated, in line with the codes on page 51 of the MANUAL DE INTEGRAÇÃO DE SOFTWARE - Comunicação dos elementos dos documentos de faturação à AT, por webservice" on the PTA website. The link can be accessed below: https://info.portaldasfinancas.gov.pt/pt/apoio_contribuinte/Faturacao/Fatcorews/Documents/Comunicacao_dos_elementos_dos_documentos_de_faturacao.pdf
Reduction in VAT for gas and electricity Following the lead of multiple countries in Europe, Portugal has lowered VAT on gas and electricity to from 23% to 6% in the wake of inflation in the country. We expect other European countries to follow a similar trajectory in the coming months and are closely monitoring changing tax rates both in Europe and globally.
B2G e-invoicing delay for small / medium enterprises Further to Law Decree 42-A/2022, dated 30 June 2022, the proposed extension of the B2G mandate to small / medium enterprises (SMEs) has once again been delayed and is now expected to be implemented on 1st January 2023. This is synonymous with the further extension of PDFs being accepted as an e-invoice until 1st January 2023, underlining the Portuguese Tax Authorities' intention to consolidate and expand the scope of their fiscal measures.
SAF-T obligation extended to non-established businesses The Portuguese State Budget, approved on 27 June 2022, introduced some changes for SAF-T reporting. SAF-T reporting refers to the Standard Audit File for Tax and Portugal pioneered the SAF-T format, being the first country to introduce it on 1st January 2008. It was created with the underlying intention to orchestrate an efficient exchange of information between businesses and tax authorities. All VAT-registered taxpayers in Portugal are subject to SAF-T reporting obligations. The State Budget has now extended this obligation to foreign businesses from 1st January 2023. This effectively brings the Portuguese SAF-T legislation in harmony with the requirement for non-established companies in Portugal to also use certified billing software, which came into effect in July 2021. This requirement ensures that taxpayers can only use billing systems authorised by the Portuguese Tax Authorities (PTA), thus reducing the scope for tax evasion and fraud.
Extension of certain VAT rates Portugal's 2022 budget has been approved in Parliament. Amongst measures such as transposing certain VAT Directives for EU purposes and amending VAT compliance-related deadlines:
The reduced rate of 6% (5% in Madeira and 4% in the Azores) has been extended for:
Certain dairy-free products;
Repair services for domestic appliances;
Delivery and installation of certain solar panels.
This extension is due to expire on 30 June 2025.
Requirement to accept the PDF as an e-invoice In the past few months, we have communicated that in Portugal, a PDF can, in certain instances, qualify as an electronic invoice. The requirement to include a digital signature has yet again been delayed, further to Order 49/2022. Portugal has delayed this requirement several times. This means that now from 1st January 2023, PDFs will have to include a Qualified Electronic Signature (QES).
Requirement for e-signatures on PDF invoices In Portugal, under certain circumstances, a PDF invoice can qualify as an electronic invoice. The Covid-19 pandemic has meant that many countries around the world have had to deal with challenges in the management of their fiscal operations. Part of these challenges have involved governments acknowledging that they must provide some concessions to taxpayers. During much of Covid, PDF invoices were made available to clients, despite not meeting the stringent requirements to qualify as an invoice. During the following periods, it was / is permitted that PDFs can qualify as e-invoices, despite not meeting stringent requirements:
April, May and June 2020;
9 November 2020 to 31 December 2021;
1 January 2022 to June 30 2022.
This means that up to 30 June 2022, PDFs can be accepted as e-invoices without the need to meet any specific requirements. At all other times, the PDF must be digitally signed to be accepted as an e-invoice.
Confirmation ATCUD code remains optional & option to use PDF invoices as an e-invoice is extended to 30 June 2022
We previously advised that the ATCUD code on Portuguese invoices (as well as other fiscal documents) is now optional from 1 January 2022. This has now been officially confirmed by Order 351/2021-XXII. Previously, it had been announced that it would be mandatory from 1 January 2022.
We also recently published an update advising that Portugal had extended the period unsigned PDFs could be accepted as an e-invoice. This had previously been extended to 31 December 2021; this has now been further extended to 30 June 2022, by virtue of Order 351/2021-XXII, at which point PDFs must be digitally signed.
Option to use PDF e-invoices extended to 31 December 2021
Portugal has previously communicated the admissibility of invoices in PDF format as electronic invoices. Order no. 260/2021-XX11, dated 27th July 2021, has extended this permissibility until 31 December 2021. This had previously been extended until 30 September 2021.
PDFs must be digitally signed from January 2022.
New standard rate of 16% in the Azores
The standard VAT rate in Portugal (the Azores) has been reduced from 18% to 16%.
Tax Circular 30237 outlines the procedures to be followed further to this tax rate change. These include:
Chargeability;
Adjustments;
The cash VAT regime;
Intra-community acquisition of goods.
There have been no changes to the mainland Portuguese tax rates.
Extension of deadline for use of PDF invoices
The introduction of Order 72/2021-XII of the State Secretary of Tax Affairs (SEAAF) dated 10 March 2021, has extended from 31 March to 30 June 2021 the term for acceptance for tax purposes of invoices in PDF format as electronic invoices.
Non-resident billing software certification from 1 July 2021
To combat tax evasion and fraud, the Portuguese Tax Authorities have defined some rules that billing systems must fulfil to ensure the non-violation of billing data once it is registered.
This means that only billing systems that fulfil the requirements defined in law and which are certified by the PTA can be used.
This will be effective from 1st July 2021. These new measures will also apply to non-resident businesses that are registered for VAT in Portugal with a turnover exceeding 50,000 Euros in the calendar year 2020. This means that these entities are required to use exclusively billing systems certified by the PTA for issuing invoices and other relevant tax documents.
There are a few options to business how to go about this- including choosing to have their own software certified, using third-party pre-certified software or outsourcing the process.
Extension of acceptance of PDF formats
The Secretary of Tax Affairs stated in November 2020, that PDF invoices will still be deemed as electronic for tax and legal purposes, until March 2021.
This has now been extended from 31 March 2021 to 30 June 2021.
Postponement of single document code ('ATCUD')
In decree 195/202, the Portuguese Government announced the requirement for businesses to include a single document code (ACTUD) on invoices and other documents relevant for taxation by January 2021. This has now been delayed until 2022.
However, Ministerial Order nº 412/2020.XXI stipulates that the Portuguese Tax Authority should strengthen support for taxpayers in meeting the obligation to include a QR Code (Quick Response Code) on invoices from 01/01/2021.
Please follow the link here for the technical specifications of the QR Code.