VAT payments allowed in installments in Portugal in 2021

Due to Covid-19, the Portuguese tax authorities announced that taxpayers will have the option to pay VAT due in installments during the first six months of 2021. The conditions for this extension are strict.

4 March, 2021


VAT payments in Portugal can be paid in installments in 2021

The Portuguese tax authorities announced that due to the current pandemic, taxpayers could opt for an installment plan to make their VAT payments in Portugal. This installment scheme will be available for both monthly and quarterly VAT filings.

For monthly filings, this will apply to VAT returns for November 2020 until April 2021. For quarterly filings, VAT returns for the fourth quarter of 2020 and the first quarter of 2021 will be applicable.

Who can apply for the VAT payment installment scheme?

To qualify for this scheme, the following conditions must be met:

  • There must have been at least a 25% decrease in their average monthly revenue during the 2020 calendar year compared to 2019.
  • Monthly taxpayers must have this decrease certified by a certified accountant. If no certified accountant is available, taxpayers can make a sworn statement under oath. This is not necessary for quarterly taxpayers.
  • The invoices involved must have been submitted through the e-fatura website to the tax authorities in Portugal.
  • For monthly taxpayers, their annual turnover must have been less than 2,000,000€ in 2019. Monthly taxpayers who restarted their business activity as of 1 January 2020 are also eligible.
  • A request to join the scheme must be submitted to the Portuguese tax authorities via their website.

How will the installment scheme work?

Taxpayers can choose to make their payments according to the standard payment due dates or request permission to join the installment scheme. Under the installment scheme, VAT payments in either three- or six-monthly installments with a value greater than 25€. The first installment must be made by the end of the normal payment period.

Get in touch

Not sure if you qualify for the vat payment installment scheme or how it may affect your business flow? Let’s have a chat to discuss your needs and how we can help you.

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