VAT in Portugal for expats and freelancers
Before invoicing from Portugal, check whether VAT applies, which country’s rules govern the supply and what the invoice must show. On the mainland the standard rate is 23%; the intermediate (13%) and reduced (6%) rates apply to the goods and services listed in the VAT Code.
When VAT needs its own check
This guide helps you decide when VAT needs a separate check before you invoice from Portugal or work with Portuguese clients. It is not a VAT registration or filing review.
VAT terms and two service examples
IVA is Portugal’s value-added tax.
| Term or example | How it works |
|---|---|
| Reverse Charge | Where the applicable rule requires it, the customer accounts for VAT instead of the supplier charging it. |
| VIES | The EU system used to check an EU VAT number; a valid number supports the business-customer check but does not settle every VAT condition. |
| Business Service Example | Assume a Portuguese consultant supplies an ordinary business consultancy service to a taxable German business, with no special exception or fixed-establishment issue. The general B2B rule places the service with the customer; the German reverse-charge and Portuguese invoice/reporting requirements then apply. |
| Consumer Service Example | The same ordinary service to a private German consumer generally follows the supplier-location rule, so Portuguese VAT can apply unless a relevant exemption or special rule changes the result. |
Property-related, event, digital and other specified services can follow exceptions. Goods have their own rules. See the VAT place-of-supply rules and VIES.
The checks before invoicing
Before relying on a VAT treatment, check the activity start date, whether the customer is a business or consumer, where the service is treated as supplied, whether the small-business VAT exemption can apply for the relevant year, whether reverse charge wording is correct, whether VIES is needed, and whether recurring returns or invoice communication obligations follow.
Frequently asked questions
Do expats in Portugal always need a VAT number?
No. It depends on whether they carry out an economic activity, how the activity is registered, who the customers are, and whether an exemption or reverse-charge treatment applies.
Can I use the small-business VAT exemption?
Possibly. Under the small-business VAT exemption, a taxable person with its seat or domicile in Portugal can use the exemption if its turnover in Portugal in the previous year was no more than EUR 15,000, subject to conditions and exclusions, including exports and related activities. When an activity starts, the estimate for the current year counts.
The exemption ends as soon as current-year turnover exceeds EUR 18,750 (the threshold plus 25%) or, if turnover for the whole year exceeds EUR 15,000, from 1 January of the following year.
Do foreign clients mean I do not charge Portuguese VAT?
Not automatically. The answer depends on whether the customer is a business or consumer, where the service is supplied for VAT purposes, and whether reverse-charge wording or VIES registration is required.
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