VAT Portugal
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Value Added Tax

Value Added Tax

  • 1. General framework
  • 2. Taxable transactions
  • 3. VAT rates

    The VAT rates are as follows:

    - Reduced rate: 6% (4% for the Azores and 5% for Madeira) for goods and services included in List I annexed to the VAT Code;

    - Intermediate rate: 13% (9% for the Azores and 12% for Madeira) for goods and services included in List II annexed to the Code;

    - Standard rate: 23% (16% for the Azores and 22% for Madeira) applying to all other goods and services.

    The reduced rate is applicable, namely, to some essential goods and services, such as food, agricultural goods (if not exempt), electricity, transport of passengers, accommodation in hotel units, pharmaceutical, health products and some entertainment tickets.

    The intermediate rate is applicable to other foodstuff, wine, and certain equipment or machinery intended for agriculture.

    Certain transactions are exempt from VAT (for example, financial and insurance transactions, medical services, educational services, rental of housing). Since the trader or professional performing these activities does not charge VAT on them, they do not give the right to deduct input VAT. Other exempt transactions, however, (mainly those relating to international trade, such as exports) do confer the right to deduct input VAT.

    A VAT reduced rate of 6% may also apply for urban rehabilitation covering construction related services provided of properties located in urban rehabilitation areas.

  • 4. Place of Supply Rules
  • 5. Exemptions
  • 6. VAT deduction
  • 7. Registration and returns
  • 8. Special regimes


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