On 27 April 2021, the Portuguese Tax Authorities published Administrative Ordinance nº. 30235, to clarify the rights and obligations, for Value Added Tax (VAT) purposes, of nonresident taxable persons performing taxable operations located within the Portuguese territory.
It is important to emphasize that the instructions identified within the aforementioned Ordinance took effect as of 27 April. However, the guidelines under previous ordinances, supporting the current administrative instructions now published must also be complied with.
With regard the application of the reverse-charge, it may be important to take notice of Article 2 (1) (g)
This rule transfers the obligation of assessment and payment of the VAT due to the taxable person who has its head office, permanent establishment or domicile in the national territory or, that has appointed a fiscal representative herein, under the terms of article 30 of the Portuguese VAT Code, when acquiring goods or services from a non-resident VAT taxable entity which has its head office, permanent establishment or domicile in another EU Member State, and which does not have a fiscal representative in Portugal.
In other words,
- in case a non-established entity in Portugal who has not appointed a VAT representative in Portugal
- supplies goods or services
- to an Portugal established taxable person
- the VAT liability is shifted to the acquiror of the goods/services
- and the acquiror is liable to pay the VAT via the reverse-charge method
- no VAT is to be charged on the invoice
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