With a direct impact on the day-to-day tax obligations of businesses and professionals, these updates involve adjustments to deadlines, procedures, and declarative obligations.

What changes with these new measures?

Among the key updates approved by the Council of Ministers are:

1. Flexible VAT reporting

Businesses can now choose between monthly or quarterly VAT reporting, allowing them to align the schedule with their invoicing practices.

2. Less bureaucracy for one-off services

In specific cases, the declaration of commencement of activity is no longer required for isolated acts such as occasional service provision.

3. Extended deadline for Modelo 10 submission

The deadline for submitting Modelo 10, a declaration reporting payments made to third parties, has been extended to provide greater flexibility and ease of compliance.

What is already being implemented?

In addition to the newly approved measures, the Government has started implementing other previously announced initiatives, including:

1. Automatic submission of “zero” VAT returns;
2. Removal of annexes Q and O from the IES declaration;
3. New rules for withholding tax on payments under €25;
4. Simplified procedures for postal shipments valued under €1,000.

Why are these changes relevant?

These measures aim to reduce operational costs, eliminate administrative redundancies, and harmonise deadlines and procedures, particularly in the context of periodic declarations and auxiliary obligations.

For companies, accountants, and self-employed professionals, staying informed of these changes is essential to ensure compliance and avoid unnecessary penalties.

The Reis & Pellicano team is available to answer questions and provide guidance on the appropriate tax framework for each situation.

Who Can Benefit?

The regime is available to individuals up to the age of 35, regardless of their education level, who earn employment income (Category A) or self-employment income (Category B).

To qualify, beneficiaries must no longer be considered tax dependents and must have their tax status in order.

How to Request a Reduction in Withholding Tax

To benefit from this adjustment at source, the worker must:

• Submit a formal written request to their employer under Article 99-F of the Personal Income Tax Code (Código do IRS);
• Indicate the year in which they began earning income as a non-dependent;
• Provide supporting documentation that proves eligibility for the Young IRS scheme.

Once these steps are completed, the employer may adjust the withholding rate to reflect the applicable exemption for that year, allowing the tax benefit to be felt monthly.

Important Considerations

It’s essential that beneficiaries correctly declare the year they first started earning income, as the level of exemption varies depending on that date.

Additionally, it’s important to evaluate whether receiving the benefit in monthly pay is the most financially advantageous option, as it may result in a lower tax refund — or additional tax owed — when filing the annual tax return.

Reis & Pellicano provides legal insight to help individuals navigate evolving tax obligations with clarity and confidence.

The Municipal Property Tax (IMI) is an annual tax levied on the taxable value of real estate properties in Portugal. This tax is payable by the owners of residential, commercial properties, and land.

How is the IMI calculated?

The IMI value is calculated based on the Taxable Property Value (VPT) of the property, which is determined by the Tax Authority (AT). The IMI rate ranges from 0.3% to 0.45% for urban properties and can go up to 0.8% for rural properties. Local municipalities have the authority to set the applicable rate within these limits.

When do I have to pay the IMI?

IMI payments are made annually and can be split into installments depending on the total amount due.

• For amounts up to €100, payment is made in a single installment in May.
• For amounts between €100 and €500, payment is split into two installments, in May and November.
• For amounts over €500, payment is divided into three installments, in May, August, and November.

How can I pay the IMI?

You can find the payment details on the Finance Portal. IMI can be paid through various methods including ATMs using the provided payment reference, through home banking services offered by your bank, directly at Tax Authority offices, or at any CTT (postal services) location.

What happens if I don’t pay the IMI on time?

Failing to pay the IMI on time can result in interest charges and the enforced collection of the debt, which may include asset seizure.

Are there any benefits or exemptions from the IMI?

Yes, there are various exemptions and tax benefits related to IMI. Families with low income and limited real estate assets may qualify for a temporary exemption. Properties designated for urban rehabilitation can benefit from an IMI exemption for three years, among other specific conditions.

Can I contest the IMI value?

Yes, if you disagree with the Taxable Property Value (VPT) assigned to your property, you can request a reassessment from the Tax Authority. This process involves submitting a complaint and possibly an evaluation by experts.

Reis & Pellicano is available to provide legal advice on IMI-related matters and help clarify any specific questions you might have.

The information provided does not substitute for legal advice.