Regulatory updates - Portugal

During September, a discussion over results on combating tax and customs fraud and evasion for 2024 and the evolution of the e-invoicing system took place in Parliament. During this discussion, the secretary of state for tax affairs, Cláudia Reis Duarte, announced that efforts to adapt the finance system to VIDA had already begun to meet the 2030 timeline. Although there was no information released as to what this preparation encompasses, the details below are known.

Portugal's e-invoicing system

• Certified Invoicing Software: Since 2021, businesses have been required to use software previously certified by the Portuguese tax authorities for issuing invoices and relevant tax documents.
• E-invoicing: For B2G (business to government) transactions, businesses must issue e-invoices. This obligation began in 2021 for large taxpayers and will be fully implemented by 2026, as the remaining taxpayers will be in scope then.
• SAF-T: Since 2013, companies have been required to generate SAF-T (Standard Audit File for Tax Purposes). This file contains a predefined set of accounting, invoicing, transport documents, and issued receipts, designed to facilitate the collection of relevant tax data by tax auditors, support taxpayers' tax returns, and enable analysis of tax-relevant records. The obligation to submit the SAF-T accounting file becomes effective in January 2027.

Based on Portugal's current mandates and upcoming VIDA regulation, changes are expected to cross-border B2B transactions, such as including the real-time reporting of such data.

Although the Portuguese budget law for 2025 strongly focuses on tax measurements, it also impacts e-invoicing regulation. With this approval, invoices in PDF format will continue to be accepted and treated as equivalent to electronic invoices until December 31, 2025. In other words, taxpayers sending PDF invoices will be allowed to continue to do so all through 2025. This information can be found in 3) article 88 of Law 26/XVI/1 (in Portuguese).

The mandatory submission of the SAF-T accounting file to the tax authorities has also been postponed. This regulation was initially scheduled for 2026; however, with the state budget approval, it has been delayed to 2027.

The postponement of these mandates means businesses will have an additional year to implement QES on e-invoices. Likewise, postponing the SAF-T submission gives companies more time to make the necessary changes and be prepared when the implementation date becomes effective.

The deadline was first moved to 1 January 2023, then to 1 January 2024, and later to 1 January 2025 in response to the technical and financial challenges businesses faced in adopting QES.

The new Portuguese 2025 Budget Proposal, published on 10 October 2024, includes in number 3 of Article 88 a provision to postpone the QES requirement to 1 January 2026. If approved, PDF invoices without a QES will remain valid for tax purposes until the end of 2025.

Additionally, the mandatory submission of the accounting SAF-T file, originally scheduled for 2026, is proposed to be deferred to 2027 for the 2026 financial year, as outlined in number 2 of Article 88.

The impact of these changes is that businesses will have an additional year to prepare for implementing QES on e-invoices, allowing more time for system updates. Likewise, postponing the SAF-T submission gives companies extra time to ensure their accounting systems are fully compliant.

These changes will take effect if the proposed law is officially enacted.