Investor's Guide - Fiscal System - Main Taxes in Portugal

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Portugal Investor's Guide

 

 

Fiscal System

 

7. Stamp Tax

 

7.1 Summary Table

 

Municipal Property Transfer Tax

Imposto do Selo

Entry into Force

1 March 2000

Tax Rates

Stamp Tax is levied on those acts, contracts, documents, books, papers and other facts expressly listed in the general Stamp Tax schedule.

Exemptions

Stamp Tax exemptions available to transactions entered into by the Portuguese State, Autonomous Regions, local municipalities, social security entities, amongst others. Certain transactions, such as intra-group financing, may also benefit from a Stamp Tax exemption.

Stamp Tax Returns

Annual return referring to Stamp Tax assessed within a certain year, to be submitted until July 15 of the following year.

 

7.2 Tax Basis

  

Stamp TaxStamp Tax is due on acts, contracts, documents, titles, books, papers and other facts foreseen in the General Stamp Tax Table, which occur in Portugal and are not subject or exempt from VAT (certain prizes may be simultaneously subject to VAT and Stamp Tax). There will be no cumulative taxation on the same document or act, except for acquisitions, for no consideration, of the ownership or other rights over immovable property.

 

The abovementioned facts are also subject to Stamp Tax if, although they occur outside the Portuguese territory, they are presented for legal purposes in Portugal.

 

7.3 Rates

 

The applicable tax rates are those established in the General Stamp Tax Table at the time the tax is due. In case more than one Stamp Tax rate may be applicable, only the higher actually applies. A non-exhaustive description of some of the operations liable to Stamp Tax is presented in the table below: 

 

Tax basis

Rate (%)

Acquisition of ownership or other rights on real estate
(for consideration or donation).

0.8

Gratuitous acquisition of goods by individuals
(gift or inheritance), including adverse possession.

10

Letting or sub-letting of real estate
(applied on the amount of first monthly rent).

10

Guarantees, regardless of their nature or form, except if materially accessory and simultaneously to contracts subject to Stamp Tax under other rule:

·       Less than one year (per month or fraction)

0.04

·       One or more years

0.5

·       Five or more years or without term

0.6

Use of credit:

·       Less than one year (per month or fraction)

0.04

·       One or more years

0.5

·       Five or more years or without term

0.6

·       Revolving credit facilities (credit used in the form of current account, overdraft or any other form in which the maturity is not determined or non-determinable) – per month on the average monthly debt balance daily assessed (dividing the sum of the daily debt balance by 30).

0.04

Operations performed by or through credit and financial institutions:

·       Interest

4

·       Premiums and interest due on promissory notes

4

·       Commissions on given guarantees

3

·       Other commissions for financial services

4

Property, usufruct or surface right on urban property with property tax value above € 1,000,000 (annually due by each property and assessed by the Portuguese Tax Authority in the same conditions as set for IMI):

·       For residential purposes (including land for construction of a residence)

1

·       When held by an entity resident in a tax heaven (except individuals).

7.5

Global net asset value of undertakings for collective investment (UCIs) - due on a quarterly basis

·       UCIs investing only in money market instruments and deposits

·       Other types of UCIs (including real estate funds and companies)

 

 

0,0025%

 

0,0125%

     

7.4 Payment 

 

Taxpayer must assess and pay the due Stamp Tax. For instance, is the lender who is liable to assess and pay the Stamp Tax due, except if there is any public notary or credit institution, financial entity or identical entity, resident in Portugal, intermediating the operation, where said liability will remain with the latter. Notwithstanding, whenever the credit is granted by a non-resident entity without intervention of a public notary or without intermediation of a Portuguese financial institution, the borrower will be responsible for the assessment of the tax and its payment to the Portuguese Tax Authority. 

 

Stamp Tax should be delivered to the Portuguese Tax Authority until the 20th day of the following month where the tax is due. The economic burden of Stamp Tax is borne by the entity that bears the economic interest (for instance: in loans, by the borrower).

 

Annex 1

[Tax Treaties withholding tax rates]

 

Tax Treaties withholding tax rates

Countries

Entry

into force

Rates

Dividends

Interest

Royalties

Argelia

01/05/2006

10/15 (a)

15

10

Austria

28/02/1972

15

10

5/10 (b)

Belgium

19/02/1971 –05/04/2001

15

15

10

Brazil

01/01/2000

10/15 (a)

15

15

Bulgaria

18/07/1996

10/15 (a)

10

10

Canada

24/10/2001

10/15 (a)

10

10

Cape Verde

15/12/2000

10

10

10

Chile

25/08/2008

10/15 (a)

5/10/15 (c)

5/10 (d)

China

08/06/2000

10

10

10

Colombia

30/01/2015

10

10

10

Cuba

28/12/2005

5/10 (a)

10

5

Cyprus

01/08/2013

10

10

10

Czech Republic

01/10/1997

10/15 (a)

10

10

Denmark

01/01/2003

10

10

10

Estonia

01/01/2005

10

10

10

Finland

14/07/1971

10/15 (a)

15

10

France

18/11/1972

15

10/12(f)

5

Germany

08/10/1982

15

10/15 (g)

10

Greece

01/01/2003

15

15

10

Guinea Bissau

05/07/2012

10

10

10

Hong Kong

03/06/2012

5/10 (o)

10

5

Hungary

08/05/2000

10/15 (a)

10

10

Iceland

01/01/2003

10/15 (a)

10

10

India

05/04/2000

10/15 (a)

10

10

Indonesia

11/05/2007

10

10

10

Ireland

11/07/1994 – 18/12/2006

15

15

10

Israel

18/02/2008

5 (a)/10 (n)/15

10

10

Italy

15/01/1983

15

15

12

Japan

28/07/2013

5/10 (p)

5/10 (p)

5

Korea (Rep.)

21/12/1997

10/15 (a)

15

10

Koweit

05/12/2013

5/10 (p)

10

10

Latvia

07/03/2003

10

10

10

Lithuania

26/02/2003

10

10

10

Luxembourg (m)

30/12/2000

15

10/15 (h)

10

Macao

01/01/2009

10

10

10

Malta

01/01/2003

10/15 (a)

10

10

Mexico

09/01/2001

10

10

10

Moldova

18/10/2010

5/10 (a)

10

8

Morocco

27/06/2000

10/15 (a)

12

10

Mozambique

01/01/1994

– 07/06/2008

15

10

10

Netherlands

11/08/2000

10

10

10

Norway

15/06/2012

5/15

10

10

Pakistan

04/06/2007

10/15 (a)

10

10

Panama

10/06/2012

10/15 (o)

10

10

Peru

12/04/2014

10/15

10/15

10/15

Poland

04/02/1998

10/15 (a)

10

10

Qatar

04/04/2014

5/10

10

10

Romania

14/07/1999

10/15 (a)

10

10

Russia

01/01/2003

10/15 (a)

10

10

Singapore

26/12/2013

10

10

10

Slovakia

01/01/2005

10/15 (a)

10

10

Slovenia

01/01/2005

5/15 (a)

10

5

South Africa

22/10/2008

10/15 (a)

10

10

Spain

28/06/1995

10/15 (a)

15

5

Sweden

01/01/2000

10

10

10

Switzerland

17/12/1975

5/15 (a)

10

5

Tunisia

21/08/2000

15

15

10

Turkey

18/12/2006

5/15 (a)

10/15 (i)

10

Ukraine

01/01/2003

10/15 (a)

10

10

UAE

22/05/2012

5/15 (o)

10

10

United Kingdom

20/01/1969

10/15 (a)

10

5

United States of America

01/01/1996

5/15 (a)

0/10 (j)

10

Uruguay

13/09/2012

5/10 (a)

10

10

Venezuela

08/01/1998

10/15 (a)

10

10/12 (k)

(*) The reduced rates are applicable either by relief at source mechanism or refund reclaim provided the beneficiary presents the necessary forms (21-RFI to 24-RFI), duly completed and authenticated by the respective tax authorities or alternatively a tax residence certificate of the recipient of the income. 

(a)  Reduced rate whenever the beneficiary is a company that holds at least 25% of the subsidiary’s share capital (two years holding period) and 15% in the remaining cases. In the case of Chile, Cuba, Slovenia, Spain, Finland, Moldova, Norway, UK and Switzerland, there is no minimum holding period required. In the case of the UK, the shareholding percentage criterion is replaced by voting rights. In the case of Venezuela, there is no requirement on a minimal capital shareholding on the company of the other Contracting State. In the case of Uruguay, there is no requirement on a minimum shareholding period. 

(b)  When the company holds more than 50% of the share capital.  

(c)  5% on bonds or securities that are regularly and substantially traded on a recognized securities market, 10% on loans granted by banks and insurance companies or on sale on credit and 15% on the remaining cases.

(d)  5% on royalties for the use of, or the right to use, any industrial, commercial or scientific equipment. 10% on the remaining cases.  

(e)  10% whenever the parent company controls more than 50% of the subsidiary’s share capital. 5% on the remaining cases.  

(f)   10% for interest derived from bonds issued in France on or after 1/1/1965; 12% on the remaining cases.  

(g)  10% for interest on loans granted by a bank. When the interest is derived from Portugal, the 10% rate is only applicable if the operation for which such loans are granted is officially deemed to be of economic or social interest for Portugal.  

(h)  10% on interest paid by companies resident in a Contracting State, where interest paid is considered as a deductible cost, to a financial establishment resident in the other Contracting State. 15% on the remaining cases.  

(i)   10% for interest paid on a loan made for a period of more than to years.  

(j)   0% on interest on a long-term loan (5 or more years) granted by a bank or other financial institution that is a resident of the other Contracting State  

(k)  10% for royalties concerning technical assistance.  

(l)   Many treaties provide for specific withholding tax exemptions of on interest, namely when interest is paid by and to a State, local authority, central bank, or export credit institutions and when interest is pain in relation to sales on credit.  

(m)The treaty does not apply to exempt Luxembourg 1929 holding companies.  

(n)  10% whenever the beneficial owner is a company that holds directly at least 25% of the paying company’s capita. Furthermore, this company must be a resident of Israel and the dividends are paid deriving from Israeli-sourced taxable income subject to a lower rate when compared to the Israeli CIT tax rate. 

(o)  If the beneficial owner is a company (unless it is a partnership) which holds directly at least 10% of the share capital of the entity paying dividends. 

(p)  5% whenever the beneficial owner is a company (unless it is a partnership) which holds directly for an uninterrupted period of 12 months (i) 10% of shareholding with voting rights of the distributing company which is a resident of Japan, or (ii) 10% of the share capital of the company distributing dividends which is a resident of Portugal.

 

Annex 2

[Blacklisted jurisdictions]

 

Andorra

Falkland Islands or Malvinas

Marshall Islands

Saint Kitts and Nevis

Anguilha

Fiji Islands

Mauritius

San Marino 

Antigua and Barbuda

Gambia

Monaco

Saint Pierre and Miquelon

Netherlands Antilles

Grenada

Montserrat

St Vicente and the Grenadines

Aruba

Gibraltar 

Nauru

Seychelles

Ascension Island

Guam

Christmas Island

Swaziland

Bahamas

Guyana

Niue Island

Svalbard 

Bahrain

Honduras

Norfolk Island

Tokelau

Barbados 

Hong Kong 

Sultanate of Oman

Kingdom of Tonga

Belize

Jamaica

Pacific Islands

Trinidad and Tobago

Bermuda 

Jordan

Palau Islands

Tristan da Cunha

Bolivia

Queshm Island

Panama 

Turks and Caicos Islands

Brunei

Kiribati

Pitcairn Isl.

Tuvalu

Channel Islands

Kuwait 

French Polynesia

Uruguay

Cayman Islands

Labuan

Porto Rico

Vanuatu

Cocos (Keeling)

Lebanon

Qatar

British Virgin Islands

Cook Islands

Liberia

Solomon Islands

United States Virgin Islands

Costa Rica

Liechtenstein

American Samoa

Yemen Arab Republic

Djibouti

The Maldives

Western Samoa

 

Dominica

Isle of Man

Saint Helena

 

United Arab Emirates

Marianas

Saint Lucia

 

 

 

 

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