Second-Hand Goods and Antiques
The new Decree-Law No. 33/2025 changes the VAT regime for second-hand goods, works of art, collectors’ items, and antiques.
The main changes include:
Application of the special scheme only to collectors’ items and antiques imported by the reseller.
Restrictions on the option to apply the margin scheme to goods acquired or imported with a reduced VAT rate.
Non-deductibility of VAT paid on the importation of collectors’ items or antiques.
Exports subject to the special VAT margin scheme benefit from VAT exemption, with the right to deduct the tax paid on importation.
Transitional regime: Resellers of works of art who have opted for the margin scheme are allowed to deduct VAT incurred on acquisitions or imports of these goods made before the entry into force of the law.
After this date, the general VAT rules apply.
Place of Supply Rules for Services
Decree-Law No. 33/2025 adjusts the taxation of services according to their place of supply, with special attention to:
In-person cultural, sports, and educational services, taxable at the place of performance.
Services delivered online (streaming) remain exempt when acquired by non-EU residents.
Specification of the tax rules for services supplied to recipients outside the Community.
VAT Exemption for Small Enterprises
Decree-Law No. 35/2025, of 24 March, introduced significant changes to the VAT exemption regime for small enterprises in Portugal, aligning national legislation with Directives (EU) 2020/285 and 2022/542.
The main changes include:
- Application to Taxable Persons with Organised Accounting
Previously, the exemption regime was restricted to taxable persons without organised accounting. With the new changes, any taxable person, whether or not they have organised accounting, may benefit from the exemption, provided they meet the established criteria.
- Inclusion of Taxable Persons from Other EU Member States
The exemption regime has been expanded to cover taxable persons established in other EU Member States. To benefit from the exemption in Portugal, these taxable persons must:
- Have an annual turnover in the European Union not exceeding EUR 100,000.
- Give prior notification to the Member State where they are established of the intention to benefit from the exemption in Portugal.
This measure aims to facilitate the activity of small enterprises operating cross-border within the EU.
- Changes to Turnover Limits to Benefit from This Regime
- New Reporting Obligations
- Taxable Persons Established in Portugal: May benefit from the exemption if their annual turnover in the national territory does not exceed EUR 15,000.
- Taxable Persons from Other Member States: May benefit from the exemption if their annual turnover in the European Union does not exceed EUR 100,000 and they meet the conditions mentioned above.
Taxable persons intending to benefit from the exemption in Portugal must:
Notify the Portuguese Tax and Customs Authority (AT) of their intention to apply the exemption regime.
Provide information on their turnover in Portugal and other Member States, for both the previous and current calendar year.
These obligations aim to ensure transparency and compliance with the conditions for applying the exemption regime.
Transitional Provisions of the Regime: The decree-law establishes that the new rules will enter into force from 1 July 2025, allowing an adaptation period for the affected taxable persons.
These changes aim to simplify tax compliance for small businesses and harmonise national legislation with European directives, promoting a more favourable tax environment for the growth of small businesses in Portugal and the European Union.
Extension of the VAT Cash Accounting Scheme
Decree-Law No. 34/2025 extends access to the cash accounting scheme for VAT:
The turnover limit for joining the scheme increases from EUR 500,000 to EUR 2,000,000 annually.
This measure aims to improve the financial management of businesses by allowing them to pay VAT to the State only after the actual receipt of invoiced amounts.
This change only takes effect from 1 July 2025.
