Key takeaways
- Expanded 6% VAT rate: Portugal now applies the reduced VAT rate to items like canned fish, vegetal butter, cultural events, biomass heaters, and bicycle repair services.
- New invoicing rules for non-residents: Foreign VAT-registered businesses must use certified invoicing software, include a QR code, and submit monthly SAF-T reports.
- Updated VAT deadlines: The filing deadline for June and Q2 VAT returns is now September 20, with payments due by September 25.
In short: Portuguese VAT changes in 2023 widened the 6% reduced rate to goods like canned fish, biomass heaters and bicycle repairs. Foreign VAT-registered businesses gained new invoicing rules, including certified software, QR codes and monthly SAF-T reporting. The June and Q2 VAT deadlines also moved to September 20 for filing and September 25 for payment.
Portugal made several big changes to its VAT regime in 2023. Here is a closer look at the key 2023 VAT updates in Portugal.
Which goods and services now get the 6% reduced rate?
Portugal has cut VAT rates for certain goods and services. As of 2023, these categories now qualify for the 6% reduced Portuguese VAT rate:
- Canned fish and mollusks, as long as fish makes up at least 50% of the product.
- Vegetal butter, drinks, and yogurts made with ingredients such as fruits, dried fruits, cereals, and vegetables.
- Access to live broadcasts of concerts, theaters, amusement parks, cinemas, museums, and similar cultural or entertainment events.
- The sale and installation of certain heaters and boilers that run on biomass.
- Services for the sale or repair of bicycles. Spare parts for bicycles are the exception and keep the standard VAT rate of 23%.
- Pellets and briquettes made from biomass materials.
What are the new invoicing rules for non-resident taxpayers?
From January 1, 2023, foreign businesses that are VAT-registered in Portugal face three extra VAT invoice requirements. These rules already applied to resident taxpayers:
- All invoices must come from certified invoicing software that can assign a unique ATCUD code.
- Paper or PDF invoices must include a QR Code.
- Foreign companies must also report invoices monthly through the SAF-T billing file.
What is the new VAT return deadline?
The new Portuguese VAT return deadline for June and the second quarter is September 20, with payment due by September 25. This applies to taxpayers who file monthly or quarterly VAT returns. The change applies from 2023 onward.
How often do you file VAT returns in Portugal?
It depends on turnover. Businesses with turnover of €650,000 or more in the previous calendar year file monthly. Everyone else files quarterly, but can opt to file monthly.
The deadlines under the Portuguese VAT Code are:
- Monthly filers: return by the 20th and payment by the 25th of the second month after the month of the sales.
- Quarterly filers: return by the 20th and payment by the 25th of the second month after the quarter ends.
- June and second quarter: return by September 20 and payment by September 25 for both groups.
For example, a monthly filer’s March return is due by May 20, with payment by May 25. A quarterly filer whose turnover reaches €650,000 must switch to monthly filing from January 1 of the next year. The rules are in Article 41 of the VAT Code.
Do non-resident businesses need a VAT representative in Portugal?
Only if they are based outside the EU. A business with no seat or fixed establishment in another EU country must appoint a VAT representative to register and trade in Portugal. EU-based businesses may appoint one, but it is optional.
The representative handles VAT obligations, including registration, and owes the VAT on the business’s sales. The non-resident business is jointly liable for that VAT. You must tell your customer about the appointment before the sale takes place.
What are the VAT rates in Portugal?
Mainland Portugal has three VAT rates: 23% standard, 13% intermediate and 6% reduced. The Azores and Madeira can set their own, lower rates, so check where the sale is taxed before applying a rate.
What do these changes mean for businesses selling in Portugal?
For businesses, the 2023 changes mean three practical checks:
- Check product rates: confirm whether your goods or services fall in the 6% reduced category before you set prices. Bicycle spare parts, for example, stay at the 23% standard rate.
- Review non-resident invoicing: if you are VAT-registered in Portugal but based abroad, your invoices need certified software, an ATCUD code and a QR code. You also need to send monthly SAF-T billing data.
- Diary the summer deadline: June and second-quarter returns are due on September 20, with payment by September 25.
For Portuguese registration rules and rates, see our Portugal VAT guide.
How Taxually handles this
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Frequently asked questions
What are the main VAT changes in Portugal for 2023?
Portugal expanded its 6% reduced VAT rate to include items like canned fish, vegetal products, biomass heaters, and bicycle repair services. It also introduced new invoicing rules for foreign businesses and updated VAT filing deadlines.
What are the new invoicing requirements for non-resident businesses?
Foreign VAT-registered companies must now use certified invoicing software with an ATCUD code, include a QR code on invoices, and submit monthly SAF-T billing reports.
What is the reduced VAT rate in Portugal?
Portugal's reduced VAT rate is 6%. In 2023 it was extended to items such as canned fish, biomass heaters and pellets, and bicycle sale and repair services. The standard rate is 23%.
When is the Portuguese VAT return for June and Q2 due?
From 2023, VAT returns for June and the second quarter are due by September 20, with payment by September 25. This applies to both monthly and quarterly filers.
Do I file VAT returns monthly or quarterly in Portugal?
Businesses with turnover of €650,000 or more in the previous year file monthly. Others file quarterly but can opt for monthly filing.
When is Portuguese VAT due?
Returns are due by the 20th and payment by the 25th of the second month after the month or quarter. June and second-quarter returns are due by September 20, with payment by September 25.
Does a non-EU business need a VAT representative in Portugal?
Yes. A business with no seat or fixed establishment in an EU country must appoint a VAT representative. For EU-based businesses it is optional.
