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Optional VAT reverse charge for non-resident suppliers (art. 194 of the VAT Directive)

The EU VAT system is essentially based on fractionised payments, VAT being collected at each stage of the production and distribution chain after offsetting the input VAT paid on purchases against output VAT received on sales. According to the main rule laid down by Article 193 of VAT Directive, the person liable for the payment of this VAT is the person supplying goods or services. The liable person is the person who is obligated to pay VAT to the Treasury

Member States in which the VAT is due may provide for that the person liable for the payment of VAT is the person acquiring the goods or services where the transaction is carried out by a supplier who is not established in the country in which VAT is due. Such reverse charge is defined by national regulation.

Portugal's VAT Reverse Charge: Maximize Cash Flow with Expert Support

Portugal's VAT reverse charge mechanism can impact your business. Understanding your obligations and taking advantage of potential cash flow benefits requires navigating complex regulations.

Our team of Portuguese VAT specialists can help you navigate the new reverse charge landscape. Here's how we can assist you:

  • Reverse charge applicability assessment: We'll analyze your transactions and determine if the reverse charge applies to your transactions, ensuring compliance with the latest regulations.
  • VAT compliance strategy development: We'll develop a comprehensive VAT compliance strategy that incorporates the reverse charge mechanism and optimizes your cash flow.
  • Record-keeping and reporting guidance: We'll provide clear instructions on maintaining accurate records and filing VAT returns under the reverse charge system.
  • Ongoing VAT support: You'll benefit from continuous support and timely updates on any changes to Portuguese VAT regulations, including the reverse charge mechanism.

By partnering with European VAT Desk, you can ensure smooth VAT compliance and maximize the cash flow advantages offered by the Portugal's VAT reverse charge. Contact us today for a free consultation and gain peace of mind with your Portuguese VAT obligations.

We offer a free video conference to assess your situation and provide you with a tailored solution.