Portuguese Tax Authorities advise to appoint a tax representative

The tax authorities are alerting Portuguese taxpayers residing outside the European Union, Iceland, Norway and Liechtenstein that they must adhere to the electronic notifications (Via CTT) site or appoint a tax representative if they have a tax relationship with Portugal.

An official source from the Portuguese Tax and Customs Authority (AT) said that “alert messages will be sent to taxpayers resident in third countries”, informing them of the “need to designate a tax representative or, alternatively, join the ‘electronic notifications’ whenever they are covered by the mandatory regime”.

On 8th July 2022, the Portuguese government approved the Decree-Law no. 44/2022, which changed the article 19 of the General Tax Law (Decree-Law No. 398/98), thus allowing taxpayers who reside outside the European Union and/or European Economic Area to waive the obligation to appoint a tax representative in Portugal, within certain conditions.

Before this changes to the General Tax Law, taxable persons (excluding taxpayers residing in EU and EEA) residing abroad and those who, although resident in Portugal, were absent for a period exceeding six months, were obliged to appoint a representative for tax purposes, who was resident in Portuguese territory.

With the changes made by Decree-Law no. 44/2022, taxpayers can now waive the above-mentioned obligation if they choose to be notified by the Portuguese Tax Authority through the tax authority website (e.g. Portal das Finanças) or through an official electronic mailbox (e.g.via CTT).

Also, and according to the administrative ruling “Ofício Circulado” no. 90057, dated from 2022/07/20, issued by the Portuguese Tax Authority, the appointment of a tax representative – and, thus, the choice to be notified by the Portuguese Tax Authority through the tax authority website (e.g. Portal das Finanças) or through an official electronic mailbox (e.g.via CTT) - will only be deemed necessary for those who maintain a legal relationship with the Portuguese tax authority, which may occur, for example, in the case of owning property in Portugal, namely a house, a car or carrying out investments or other assets; if you have an employment contract in the Portuguese territory; or if you perform a self-employed activity in the country.

On a conclusion note, the waiver of the obligation of tax representation should be carefully considered as the non-resident taxpayers have to be fully informed and conscious of what such decision will entail in terms of complying with their tax obligations in Portugal.