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Businesses established outside the European Union are entitled to a refund of the VAT they have paid in one of the 27 Member States of the European Union.
This year, all applications for refunds of VAT (13th Directive - EU Directive 86/560/EEC) paid in 2023 by businesses established outside the EU must be submitted by 30 June 2024 in the majority of Member States. *
Each member state has its own method for making a VAT refund claim.
❗️Some member states require the claims to be submitted by a fiscal representative approved by the local tax authorities, meaning that as UK businesses are not established in the EU, they cannot file the claim themselves.
* Except in the case of Spain, where the VAT refund application can be submitted by 30 September at the latest.
The refund of Portuguese VAT
Just like European companies, businesses established outside of the European Union are entitled to get a refund of the VAT they have paid in Portugal.
However, the Portuguese VAT will only be refunded if the following conditions are met:
The company has not carried out any operation that would require it to register for VAT in Portugal during the period the refund concerns;
The VAT has been invoiced regularly by the seller or the provider;
The VAT was paid for purchases of goods or services used for operations that give rise to the right of deduction;
The VAT doesn’t concern spendings for which the VAT deduction is excluded according to Portuguese regulation.
Procedures:
Companies established outside of the European Union have the obligation to appoint a tax representative in Portugal in order to file VAT refund claims.
They can file their claims either for a calendar quarter or for a calendar year.
If their claim is submitted for a calendar quarter, it must be on a VAT amount of EUR 400 minimum.
If their claim is submitted for a calendar year, it must be on a VAT amount of EUR 50 minimum.
The claim can be filed starting the month following a calendar quarter, or, where it applies, each calendar year.
In any case, it must be submitted within nine months after the end of the calendar year during which refundable VAT has become chargeable, namely until 30th September N+1.
As part of the international network, and together with our colleagues throughout the EU we are happy to assist with the preparation of the claims. If you need any further assistance, please get in touch.
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