Portugal Tax Important Dates - Your 2021 Tax Calendar
Both locals and foreign residents in Portugal need to be aware of their tax obligations and the dates by which they should be fulfilled. Below is a very clear and useful month by month summary of what tax issues need your attention. Failure to pay taxes at the correct time can result in fines and simply not knowing taxes were due is not a defense the Portuguese tax authorities will accept.
The information below was provided by All Finance Matters. Based in Tavira and operating acorss the Algarve, All Finance Matters provides expert insight and advice to local and foreign residents, on both personal and business tax and financial management issues. Their advice is always well-researched, practical and actionable. They can save you money, time and headaches by ensuring you are tax compliant and tax efficient.
You may also wish to consult our resources on:
- Portugal Tax
- Property in Portugal
- Algarve Expat Guide
Tax calendar: dates you need to put in your diary for 2021
This article was originally publsihed by All Finance Matters.
Below you can find some of the dates that you need to put in your diary, concerning taxes in Portugal.
Please remember that before you submit your IRS you need to perform some tasks as per the new habits acquired in the previous years: tasks like validating or registering invoices at the tax portal, are now procedures that became part of the routine of any taxpayer. Your role is important in determining your IRS deductions, therefore check the tax calendar, to make sure you don’t lose any deduction or pay any fines.
If you have a business activity which was VAT exempt under article 53, but in 2020 you exceeded the VAT threshold, then you need to change your VAT status until the 31st of January. Likewise, if you were paying VAT but did not exceed the threshold in 2020 and wish to become exempt, the same deadline applies.
If you have a rental contract and are not obliged to issue monthly rental receipts, you have until the 31st of January to declare the yearly rental income for 2020.
Each taxpayer has until the 25th of February to query, report and verify invoices. To do this you should access the e-Fatura portal and access to your personal page, where you should verify if all your invoices have been properly communicated. If you find any failure, or any invoice is not recorded, you can add these invoices to your file. It is also important to check in which category your invoices are recorded and move them into the appropriate section (ie health, education, etc) otherwise the deduction will not be accepted. These procedures need to be performed for each household expenditure holder, including dependants.
It is also important to update or register your household for tax purposes, before 15/02. Please note that this can be very important, not only for tax purposes, but for other related matters, such as inscription at schools, kindergarten, etc and or other tax benefits you may be entitled to.
If you became resident in Portugal in 2020 and want to apply for the Non-Habitual Residency scheme, you have until the end of March to submit your application at the tax portal.
Find out about NHR in Portugal
During March, you also need to check your e-fatura page at the tax portal and if you feel the information is not correct, you can challenge the calculations made by the Tax Authorities. In other words, your tax deductions will be summarized here, under family general expenses, healthcare expenses, training and education expenses, charges with property for permanent residence, invoices VAT and costs with foster homes; if your total invoices is not consistent with the one totals shown in the portal, you have this two weeks window to contest it. Please note that it’s necessary to check this for each taxpayer.
You can submit your IRS tax declaration for 2020, from the 1st of April, until the end of June. This means that all declarations can be submitted during these three months, irrespective of your income category (employment income, pension income, self-employment income, rentals, etc.)
Please note that all residents, include Non-Habitual Residents, need to submit a tax declaration, even if they’re income is only pensions, and tax exempt, they still have to fulfil this obligation.
All non-residents that have income from Portuguese source (ie property rentals, sale of a property, etc) also need to submit a yearly declaration.
Find our more about IRS: Personal Income Tax in Portugal - what you need to know
Payment of the first instalment of the IMI council tax. If in your case, the council tax is lower than 100€, this will be the only payment date you need to remember. If is higher, please look for other instalment dates in August and November.
Do not forget to submit the IRS for 2020 by the end of June. Please remember that if you do not deliver your IRS on time, or if you fail to meet some of the deadlines above, you may lose some or all your tax deductions. Late delivery of your IRS may also cancel your IMI (Council Tax) exemption.
If you have IRS tax to receive, the settlement must be made by 31st of July. This is the deadline for the Tax Authorities to refund you.
If you have IRS tax to pay, you should make the payment no later than the last day of August, providing you have delivered the tax return within the time limits. If the tax return was submitted after the deadline, payment may be made until 31st of December (fines and interest will apply).
The second instalment of the IMI council tax is due this month. This is applicable for all those where the yearly IMI payment is higher than 500€ per taxpayer.
If you have AIMI (additional council tax) to pay, this needs to be paid by the end of September. Remember that all properties owned by companies are liable for AIMI payment. Individual owners are only exempt from AIMI, in the first 600 thousand Euros worth of property (based on the tax value and not in the commercial value).
Payment of the third and last instalment of the IMI council tax. This is applicable for all those where the yearly IMI payment is higher than 100€ per taxpayer.
Please remember that if you have a business activity, you need to report your sales file by the 10th of each month. This also includes rental income from AL license holders.
Each month you also need to issue your monthly rental receipts in case you have a rental contract registered.
The car tax needs to be paid by the last day of the month when the car was registered. Please do not forget this as the fines are high in this case.
If you have a business activity, please remember that each quarter you need to submit a social security declaration, to ascertain how much social security you will pay each month in the following quarter.
If you have any questions, please feel free to contact us; tax planning is critical and you and your company, cannot afford surprises. Contact our office to discuss your personal situation and avoid any unnecessary fines.
Contact All Finance Matters and watch the video below to find out more about their services.