Are you exempt from VAT and will exceed the maximum limit? Do this
Anyone who is exempt from VAT under Article 53 of the VAT Code (CIVA) but exceeds the maximum limit of 18,750 euros is obliged to pay tax, according to the Tax and Customs Authority (AT).
"I am exempt from VAT under Article 53 and my next invoice will exceed €18,750 in turnover. What should I do? If, in the current calendar year, the exemption threshold is exceeded by 25%. You are required to pay VAT on the invoice exceeding €18,750 (€15,000 + 25% x 15,000) and submit the declaration of changes within 15 working days from that moment ," explains the AT in a post shared on social media.
The Tax Authority also provides the following example :
"A taxpayer covered by the special exemption regime carried out, until the end of August 2025, transactions located in the national territory that total a turnover of €18,000. On 19/09/2025, he will issue an invoice, within the legal deadline for its issuance, for the amount of €1,000. Adding this amount to the turnover already achieved, he finds that it exceeds the exemption threshold by more than 25% (€18,750) . Therefore, he must, upon issuing this invoice, pay the tax due on the transaction and proceed, within 15 working days of that date, that is, until 10/10/2025, to submit the declaration of changes , on the Tax Portal, indicating the value of the turnover obtained up to that date", it can read.
Therefore, "it is subject to the normal taxation regime from 19/09/2025, inclusive".
What is VAT?
VAT is Value Added Tax, which, in practice, is a tax applied to sales or services provided in Portugal.
"VAT is paid by the consumer at the time they pay for the good or service provided. The seller or service provider receives the VAT amount and subsequently delivers it to the Tax and Customs Authority," can be read on the public services portal gov.pt.
Communicate the start of activity
This means that "individuals (self-employed workers) or legal entities (companies) that produce, sell or provide services in Portugal must pay taxes, and to do so they must submit a declaration of commencement of activity."
However, " self-employed workers are not required to declare the start of their activity if they only perform an isolated act (receive only once during the year in relation to the sale of goods or provision of services) that does not exceed 25 thousand euros ", according to the same portal.
Generally speaking, "the self-employed worker or company must submit the declaration of commencement of activity before starting to carry out the activity".
"For companies registered with a commercial registry office, the declaration of commencement of activity must be submitted within a maximum period of 15 days after registration with the registry office," it further explains.
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