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.
There have been a number of significant changes made to the Portuguese VAT regime in 2023. Here is a closer look at the key updates to VAT in Portugal this year.
Expansion of the 6% reduced rate
Portugal has implemented a reduction in VAT rates for certain goods and services. As of 2023, the following categories are now eligible for the 6% reduced Portuguese VAT rate:
- Canned fish and mollusks, provided that the fish content comprises at least 50% of the product.
- Vegetal butter, beverages, and yogurts that have been manufactured using ingredients such as fruits, dried fruits, cereals, and vegetables.
- Access to live broadcasts of concerts, theaters, amusement parks, cinemas, museums, and similar cultural/entertainment events.
- The sale and installation of specific heaters and boilers that operate using biomass as their energy source.
- Services related to the sale or repair of bicycles, with the exception of spare parts for bicycles, which will remain subject to the standard VAT rate of 23%.
- Pellets and briquettes derived from biomass materials.
New invoicing rules for non-resident taxpayers
Starting from January 1, 2023, foreign businesses that are VAT-registered in Portugal are now subject to three additional VAT invoice requirements (which are already applicable to resident taxpayers):
- All invoices must be generated using certified invoicing software capable of assigning a unique ATCUD code.
- A QR Code must be included on paper or PDF invoices.
- Foreign companies are also required to adhere to monthly invoice reporting through the SAF-T billing file.
New VAT return deadline
The deadline for filing VAT returns and making payments for June and the second quarter has been altered for taxpayers with both monthly and quarterly VAT reporting periods. Starting with the current year, the filing deadline for these two periods has been shifted to September 20, while the payment deadline has been moved to September 25.
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.
