Invoicing and Tax regulation in Portugal

Navigating Portuguese evolving e-invoicing and tax regulations can be challenging. This guide provides an overview of the latest requirements to help you stay compliant and avoid potential penalties.

In the guide, we will cover:

Regulations Timeline

Portuguese E-invoicing Requirements (2025 Updated)

Tax Regulations

Digital Reporting

Penalties

Achieving Global Invoicing and Tax Compliance with Space Invoices

 

 

Regulations Timeline

A quick overview of all current and upcoming regulations that Portugal mandates regarding e-invoicing and digital reporting. For a complete list of countries with mandatory B2B e-invoicing regulations, click here. For a comprehensive general guide to e-invoicing regulations by country, click here.

 

Regulations in Effect:

Mandatory e-invoicing for all B2G transactions,

Voluntary e-invoicing for B2B and B2C transactions.

 

Upcoming Changes to Portuguese E-invoicing:

2026: Invoices must contain a qualified electronic signature to be valid.

 

 

Portuguese E-invoicing Requirements (2025 Updated)

In Portugal, regulations mandate e-invoicing for all B2G transactions and use of certified invoicing software for companies above €50,000. This year, qualified Electronic Signatures are mandatory on PDF invoices. This mandate underscores the importance of verifying the authenticity of the document to ensure its integrity and security. While B2B and B2C e-invoicing remain optional, numerous companies have proactively embraced e-invoicing.

To support this transition, Portugal has implemented:

The PEPPOL network

Directive 2014/55/EU

Platform eSPAP

 

Certified Invoicing Software

Any business with a turnover that exceeds €50,000 in the previous year, and is either VAT-registered or provides billing services to other entities, must use certified invoicing software. This software supports electronic data interchange, facilitating standardized communication of business documents, including invoices, in a digital format.

Software providers are required to undergo a rigorous testing process conducted by the Portuguese Tax Authority to ensure compliance and reliability. Once the software passes this evaluation, it is assigned a certification number. It is essential for the invoicing software to be regularly updated to remain in compliance with changes in tax legislation and reporting requirements.

 

Governmental Body Responsible for E-invoicing

Responsibility for e-invoicing regulations in Portugal lies with the Agência para a Modernização Administrativa (AMA).

Click here to visit their official website.

Furthermore, the Autoridade Tributária e Aduaneira (Portuguese Tax Authority) plays a critical role in ensuring that businesses comply with VAT regulations and submit electronic invoices correctly as part of their fiscal obligations.

Click here to visit their official website.

 

E-invoicing Formats

In Portugal, e-invoices are typically exchanged using the XML format, usually in either UBL or PEPPOL BIS Billing 3.0. Businesses connect to FACeB2B; facilitating the exchange of electronic invoices between B2B and supports the Spanish government’s commitment to streamlined digital invoicing.

 

E-invoice Requirements

Invoices must be issued at the time of the supply and for taxable customers, they have to be issued by the 15th of the month following the provision of goods or services. They can be issued in either electronic or paper form and must include the following components:

Unique and Sequential Invoice Number;

Date of issuance;

Identification of the Seller and the Buyer: full name, address and Tax Identification Number (NIF), suppliers NIF only if the customer is also a taxable entity and the transaction is subject to VAT;

Information about Goods or Services Provided: description, quantity, unit price, excluding VAT;

VAT Information: applicable VAT, total VAT amount, total invoice amount including VAT;

Total amount excluding VAT;

Currency;

Payment terms: including payment due date and any discount;

Reference to the legal requirement for the invoice: if applicable, include references to contract agreements, purchase orders, or any other legal obligation necessitating the invoice.

QR Code and ATCUD.

 

B2C Transactions:

Simplified e-invoices may be issued, which require less information than full invoices, but only if the total amount, including VAT, does not exceed €1000 for B2C and €100 for B2B.

Simplified Invoices Include:

 

E-invoice Validating

It is mandatory to include a QR code on all e-invoices issued within Portugal. This QR code facilitates immediate access to invoice details for both tax authorities and taxpayers, enhancing transparency and ease of verification.

Alongside the QR code, the ATCUD (Código Único de Documento), or unique document code, is another essential element of the e-invoice. The ATCUD, which is provided by the Portuguese Tax Authority (Autoridade Tributária e Aduaneira), serves as a critical identifier for the invoice.

 

E-invoice Archiving

E-invoices must be archived for a minimum of ten years.

 

 

Tax Regulations

Value Added Tax (VAT)

In Portugal, the standard VAT rate, known as Imposto Sobre o Valor Agregado (IVA), is 23% and applies to most goods and services. Portugal also has different VAT rates:

13% rate: Certain foodstuffs, some passenger transport services, and some wines.

6% rate: Specific foodstuffs, pharmaceutical products, books, newspapers, and certain types of accommodation.

There are also regional differences:

In Madeira, the rates are 22%, 12%, and 5% VAT.

In the Azores, the rates are 16%, 9%, and 4% VAT.

 

Corporate Tax

The standard corporate tax rate in Portugal is 21%. Small and medium-sized enterprises (SMEs) benefit from a reduced corporate tax rate of 17% on the first €25,000 of taxable profit.

Additionally, regional variations in corporate tax rates apply in Portugal's autonomous regions: In Madeira, the corporate tax rate is 20%, and in the Azores, it is 16.8%.

 

VAT on Digital Services in Portugal

Digital services in Spain are generally subject to an 23% VAT on the mainland, 22% in Madeira, and 16% in the Azores. Digital services that are subject to VAT include e-books, software downloads, music, movies, games, and other electronically supplied services.

 

 

Digital Reporting

Ukraine has already introduced several digital reporting requirements, with more to come:

B2G e-invoicing is required for all companies;

The Portuguese Tax Authority encourages the electronic filing of VAT Returns and Payments through its online portal (Portal das Finanças).

 

VAT Registration and Thresholds

VAT registration threshold for domestically established businesses is €14,500 in 2024 and will rise to €15,000 in 2025.

For EU-based businesses engaged in distance selling of goods or services to Portuguese consumers, the threshold is €10,000.

Non-EU businesses selling into Portugal have no VAT registration threshold; they are required to register for VAT immediately upon beginning sales of goods or services to Portuguese consumers.

 

VAT Returns and Payments

The reporting frequencies are as follows:

Monthly: Required for businesses with a turnover exceeding €650,000 in the previous year. VAT returns must be submitted by the 10th of the second month following the reporting period.

Quarterly: Required for businesses with a turnover of less than €650,000. These reports must be submitted by the 15th of the second month following the end of the quarter.

 

 

Penalties

Penalties for failing to issue invoices on time range from €150 to €3,750.

Penalties for inaccuracies in statements or tax-relevant documents range from €750 to €22,500.

Failing to prepare accounts in accordance with Portuguese accounting standards can result in fines ranging from €1,000 to €10,000.

If you fail to include mandatory elements such as the QR code and ATCUD on invoices, penalties can range from €200 to €1,000 per invoice.

Penalties for late tax payment due to negligence can range from 15% to 50% of the unpaid tax for natural persons (with a maximum penalty of €22,500), and from 30% to 100% for legal persons (with a maximum penalty of €45,000).

For culpable delays up to 90 days, fines can increase to 200% of the outstanding tax for natural persons (up to a maximum of €82,000), and to 400% for legal entities (up to a maximum of €165,000).

Fines for non-delivery of VAT are based on the amount owed, but have a minimum value of €25.

Businesses that fail to use the required certified invoicing software in Portugal face fines ranging from €1,000 to €18,750.

 

 

Achieving Global Invoicing and Tax Compliance with Space Invoices

Add Certified invoicing software.

 

One way to comply with (e-)invoicing, tax, and reporting regulations in Portugal is to use a provider like Space Invoices.

You will be able to:

Have one API for current and future global tax and invoicing compliance, including Portugal

Save time and money with integration that takes less than a week

Support and upsell your clients worldwide, including Portugal

Ensure all documents are archived and successfully reported to responsible institutions

Become a one-stop shop for current and future clients

Streamline processes and eliminate manual errors, saving time and money

Do you have questions about achieving compliance in Portugal?

We are ready to help.

 

The information in this guide is strictly informative, as regulations and timelines change frequently. While we make every effort to monitor updates and maintain the accuracy of our content, we recommend consulting with a tax professional or e-invoicing specialist for the most reliable and personalized advice. This guide was last updated on January 29, 2025.

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