AICEP
Agência para o Investimento e Comércio Externo de Portugal

Fiscal System

7. Stamp Tax 

7.1 Tax basis

Stamp 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.

7.2 Rates

The applicable tax rates are those established in the General Stamp Tax Chart 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:

7.3 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]

(*)         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 (but no need to be authenticated by the respective tax authorities) and 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 Andorra and Saudi Arabia, the shareholder percentage criterion is limited to 10% of the capital of the company which pays the dividens. 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 Barbados, Bahrein, Croatia, United Arab Emirates, Ethiopia, Georgia, Moldavia and Uruguay, there is no requirement on a minimum shareholding period. In the case of Angola, the minimum holding period is 365 days.

(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 two 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. In the case of Montenegro, the percentage is 5%. In the case of Vietnam, it is applicable a rate of 5% if the beneficial owner is a company which holds, directly, at least 70% of the capital of the entity paying the 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.

(q) 5% for royalties related with any copyright of literary, artistic or scientific work and 10% for royalties related with patents, trade-marks, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience.

(r) 10% for royalties and 7,5% for income generated from technical fees (managerial, technical or consultancy).

Annex 2

[Portuguese Blacklisted jurisdictions] 

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