Certified billing software in Portugal as from 1 January 2020
The requirement of using a certified billing software in Portugal is expected to be extended as from 1 July 2019.
4 May, 2019
Most Portuguese businesses were already required to issue invoices from a certified billing software. Former rules required all established companies to use this software when their previous annual revenue exceeded € 100,000, this threshold was now decreased to € 75,000 in 2019 and €50,000 in 2020.
Non-established companies would also be required to use a certified billing software as from 1 January 2021. The information about this obligation for non-established foreign companies is ambiguous. Despite rumours of this obligation being waived, it has been finally confirmed that all foreign businesses registered for VAT in Portugal should comply with the new obligation.
Certain transactions are excluded from this obligation, including:
- Invoices issued under reverse charge mechanism
- Invoices issued for public events such as ticket for museums or shows, concerts (bearer documents).
What is a certified billing software?
A certified billing software in Portugal meets several requirements that reduce potential manipulation of business accounting. For example, this software does not allow to change manually an invoice already issued, it also does not allow the issuance of an invoice with a date in the past.
The authorities evaluate each billing software or ERP and , once they confirm that it is compliant with their requirements, they allocate a registration number to the software. This number must be indicated in each invoice.
In practice, most Portuguese companies already have a local certified billing software that meet their requirements. Some foreign businesses established in Portugal have gone through the process of validating their existing ERP.
What are the penalties for not complying with the Portuguese certified invoicing requirement?
When invoices are not issued with a certified billing software, there is a risk of these invoices being considered as invalid expenses, both for CIT and VAT, by the Portuguese Tax Authorities and also clients. For example, in established companies which are obliged to use certified software, it is very common to see accountancy departments returning invoices which do not show the correct hashtag of the certified software or which are not issued from a certified software.
In addition, there are specific sanctions foreseen in the law for not meeting this requirement. Under the General Infractions Code, the issuance of invoices without certified software can be sanctioned (in wide terms) as follows
|Type of infraction||Penalty considering negligent behaviour|
|Failure to issue invoices or receipts||€ 300 to € 3,750|
|Failure to request invoices or receipts issued within the law||€ 150 to € 2,000|
|Failure to use certified invoicing software or equipment||€ 3,000 to € 18,750|
The above fees would double in case of fraud or knowledge about the infraction made.
Portuguese SAF-T returns
There are no changes on the obligation to report Portuguese SAF-T returns. These reports are only required by established companies in Portugal.
However, we believe that having a certified billing software will quickly extend the SAF-T obligation to non-established companies also.
Marosa´s proposed billing software is able to generate a monthly SAF-T report automatically each reporting period.
What is the difference between the e-invoicing requiremen and certified invoicing requirement?
- E-invoicing requirements apply to the way the electronic invoices are issued in itself. As from 31 December 2020, tax authorities will require features that secure the authenticity of the electronic invoice like electronic qualified signature, qualified electronic stamp or EDI protocol. These are add-ons to the invoices itself. Currently, you can issue e-invoices either with advanced electronic signature or just by implementing controls that provide a reliable audit trail that attest to the integrity and authenticity of the document. The wording of article 12 of DL 28/2019 + article 43(10) indicate that after 31 December 2020, the integrity and authenticity of the document are guaranteed if, namely, the apposition of an electronic qualified signature, qualified electronic protocol or EDI protocol. This wording is being understood by advisors (such as the ones you indicate) as meaning that only of these means may be used to have a valid e-invoice. An e-invoice is mandatory on B2G sales.
- Certified invoicing requirements relate to the data structure of the software that issues the invoices itself, the taxonomies which may be used and also the permissions and prohibitions of the certified invoicing system (for example, the system may not allow for invoices to be changed after issuance; for this, a rectification document such as a credit or debit note must be issued).