Law and regulation of Covid-19 tax relief in Portugal

Value Added Tax

  • Allow companies and self-employed tax payers to pay the VAT in monthly instalments (3 or 6), as from the second quarter. No guarantee required. No penalties. No interest charged. Regime available for companies with a turnover in 2018 not exceeding EUR 10M or, if higher, as long they show a reduction in the turnover in more than 20%, compared with the same period of last year.
  • For taxpayers with a turnover of up to EUR 10,000,000 in 2019, VAT periodic returns (February, March and the first quarter 2020) can be submitted without supporting documents, provided that the situation is regularized until August.
  • Postponement (for a few days)  of the deadlines to file VAT periodic returns (February, March, April and first quarter 2020) and pay the corresponding VAT.

Corporate Income Tax

  • Allow companies and self-employed tax payers to pay withholdings in instalments in the same conditions as the ones foreseen for VAT.
  • Postponement (for 5 days) of the deadlines  to pay the withholding PIT, CIT and Stamp Tax related to April and May.
  • Postponement of the deadlines to file CIT annual tax returns (from May to June) and the payment of special payments on account (from July to August).
  • Postponement of the deadline to prepare and file (when applicable) the 2019 tax file, including the transfer pricing file, from 15th July to 31st August.
  • Postponement of the deadline to file the 2019 Tax Annual Declaration (IES), from 15th July to 7th August.

Social Security Contributions or Payroll Tax

  • Social Contributions due by the companies may be paid in three monthly installments in the months of March, April and May (or April, May and June). This deferral is immediately available for companies with maximum of 50 workers. For companies with up to 250 workers, this reduction is only applicable as long they can show a reduction in turnover of more than 20%, compared with the same period of last year.

Other relief measures

  • Coercive tax collection procedures are suspended for 3 months;
  • Access to special financing conditions especially for small and medium size companies.

Additional comments

  • Special procedures have been introduced to simplify the relation between the tax payer and the tax authorities through online services and telephone support.