VAT Declaration: 7 questions and answers to help you
The VAT declaration is mandatory for the self-employed person who has more than € 12,500 in turnover per year.
2 - Is it possible to be exempt from filing VAT returns?
Yes, there are cases that are exempt from VAT payment.
The people who are exempt from paying VAT are:
- Who invoices less than € 12,500 per year, regardless of the activity they have;
- Who has an exempt activity under article 9 of CIVA. Activities are exempt due to their nature (for example, anyone who has to fill out a receipt connected to a medical service is exempt from paying VAT).
You can consult article 9 of CIVA here and see if your activity is included in this list.
If your activity is not in Article 9 or invoices are over 12500€ per year, then you must complete the VAT declaration on a quarterly basis.
3 - I have simplified accounting (contabilidade simplificada), do I have to pay VAT?
The independent worker can choose to have organized accounting (contabilidade organizada) or simplified accounting. However, this criteria does not apply to the VAT declaration.
In other words, you are only exempt from the VAT declaration if you fulfill the conditions mentioned above. Thus, it is independent of the type of accounting you have at the moment.
4 - I issued an Isolated Act, do I have to declare VAT?
Yes. Isolated acts are not exempt from VAT, so if you have done an isolated act, you must complete this declaration in the following quarter.
For example, if you participated in an event and issued an Isolated Act of 200€, you must pay 23% corresponding to that amount.
You are only exempt from paying VAT if the provision of services you have done is an activity contemplated in article 9 of the CIVA (see above).
Read this article "How to create an Isolated Act for portuguese services" for more information about Isolated Act.
5 - I did not issue a receipt this quarter, do I have to declare VAT?
If in the annual overall you have invoiced or will invoice more than € 12,500 yes, you must submit the VAT declaration.
6 - What are the payment dates?
For self-employed workers who are not exempt from paying VAT, they are obliged to submit the tax return.
Payment is made on a monthly or quarterly basis, depending on the billing volume.
The monthly declaration must be made by those who have an annual turnover of more than € 650,000 (these cases are generally included in the organized accounting regime). The remaining self-employed workers, who are the majority, pay VAT on a quarterly basis.
Per article 27 of the CIVA, the quarterly regime must obey specific rules, which determine the payment deadlines. These are:
- 1st Quarter January-February-March: until May 20
- 2nd Quarter April-May-June: until August 20
- 3rd Quarter July-August-September: until November 20
- 4th Quarter October-November-December: until February 20 (next year)
Note: You must make the VAT payment after submitting the Periodic Declaration / Declaração Periódica. A payment reference is generated for payment to the State of this tax.
7 - How to deliver the VAT declaration to the State?
In order to issue the VAT declaration, you must first have the green receipts issued for the quarter to which the declaration corresponds. To help you, read the article "How to Issue a Green Receipt".
To make the VAT declaration, access the Finance Portal and follow these steps: Todos os Serviços -> IVA -> Declaração Periódica do IVA -> Entregar Declaração
See our article "How to issue the VAT declaration" for more details.