VAT Payments – Flexible Regime

The Portuguese Government enacted Dispatch 52/2021-XXII, of February 25th, 2021, allowing VAT payment in installments.

Businesses (taxable persons) collecting VAT are entitled to request VAT payment in installments.

This measure applies to VAT collected in the last quarter of 2020 for taxable persons filing quarterly returns and VAT assessed monthly.

Eligibility for this benefit requires the fulfillment of one of the following conditions:

• Turnover of a micro, small and medium-sized enterprise (SME), i.e. not exceeding an annual turnover of EUR 50 million; or
• Main activity, i.e. classification of economic activity (CAE), is accommodation, catering and similar, or cultural activities; or
• Activity started or restarted on or after January 1st, 2020.

VAT can be paid to the Portuguese Tax Authorities in three- or six-monthly installments, without interest being due. A minimum payment of EUR 25 applies. The first installment is due within the regular payment timeline.

This benefit must be requested electronically at the Portuguese Tax Authorities’ website until the end of the voluntary period for VAT payment.

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