Tax and Customs Authority Binding Information

Case no. 8218, with concordant approval dated 18 May 2015, made available on

1 June 2015, of the Sub-Director General of VAT

Treatment - Psychomotor rehabilitation - Exclusion of application of the exemption provided for in Article 9(1) of the VAT Code

The Tax Authorities clarify the applicability of the VAT Code to the activity of psychomotor rehabilitation.

The Tax Authorities conclude that, notwithstanding the academic qualifications awarded to professionals engaged in psychomotor rehabilitation and the description of their activity, this activity is not listed or designated in Decree-Law 261/93, of 24 July, nor in Decree-Law 320/99, of 11 August (both of the Ministry of Health), concerning the regulation of auxiliary health professions.

Thus, the Tax Authorities state that psychomotor rehabilitation does not fall within the scope of the exemption provided for in Article 9(1) of the VAT Code, which exempts from tax those services provided by persons exercising "professions of physician, dentist, midwife, nurse and other auxiliary health professions".

Tax and Customs Authority Binding Information

Case no. 8617, with concordant approval dated 18 May 2015, made available on 1 June 2015, of the Sub-Director General of VAT

Invoicing – Issuance and content in the Portuguese language

The Tax Authorities clarify that, notwithstanding the legal requirement to issue invoices in Portuguese, set out in Article 3 of Decree-Law 238/86, of 19 August, they have been accepting, in exceptional cases, invoices in a foreign language when this does not affect the correct assessment of the tax and provided its translation into Portuguese is guaranteed whenever deemed necessary by the Tax Authorities.

Tax and Customs Authority Binding Information

Case no. 8312, with concordant approval dated 21 May 2015, made available on 1 June 2015, of the Sub-Director General of VAT

Rates – Service provided through of a website concerning medical appointments, tests, medical analyses, physiotherapy, surgeries and other services

The Tax Authorities analysed whether the provision of intermediation services through a website, concerning the acquisition of specialist appointments, tests, medical analyses, physiotherapy, surgeries and other services, could benefit from the VAT exemption provided for the “provision of medical and public health services and closely related activities carried out by hospital establishments, clinics, dispensaries and alike” (Article 9(2) of the VAT Code).

The Tax Authorities concluded that, in this specific case, the activity carried out consisted on the mere provision of the right to use a medical service (or similar) provided by a third party, for which reason such service, although possibly related to health care, is excluded from the scope of application of that exemption, representing a transacti on subject to and not exempt from tax, liable to taxation at the normal rate of 23%.

Tax and Customs Authority Binding Information

Case no. 8235, with concordant approval dated 26 May 2015, made available on 1 June 2015, of the Sub-Director General of VAT

Invoices – Requirement to issue invoices for transactions exempt from VAT

The Tax Authorities emphasise that a hybrid taxpayer, recognised as a non-profit entity, may comply with invoicing obligations regarding its exempted transactions (namely, regarding membership fees paid by its members) by issuing documents different from invoices, under the terms of Article 29(20) of the VAT Code, maintaining, however, the requirement to issue invoices for taxable transactions.

Tax and Customs Authority

Binding Information

Case no. 8739, with concordant approval dated 26 May 2015, made available on 1 June 2015, of the Sub-Director General of VAT

VAT – Rates – Transfer of Forest Biomass

The Tax Authorities clarify that the transfer of forest biomass (logging r emains, comprising: tree bark, branches and other forest residues) is liable to VAT at the reduced rate of 6%, falling within item 5.4 of list I annexed to the VAT Code.

Similarly, the Tax Authorities explain that the transfer of shredded biomass, when obtained by the farmer with means normally used in farming and forestry, is also liable to tax at the reduced rate, falling within item 5.5 of list I annexed to the VAT Code.

Finally, the Tax Authorities note that products or sub-products resulting from wood processing, carried out using any industrial processing method, are liable to tax at the normal rate of 23%.

Tax and Customs Authority

Department of Income Tax Services, Department of Corporate Income Tax Services, Department of Property Transfer, Stamp Duty, Vehicle and Special Contributions Services

Circular no. 6/2015, of 17 June

Regime of Taxation of Collective Investment Undertakings

Discloses the essential features of the new Tax Regime of Undertakings for Collective Investments (UCITs), introduced by Decree-Law 7/2015, of 13 January.

This Circular addresses, among other aspects, the scope of the new regime, the assessment of the taxable profit of UCITs, the determination of their taxable income, the exemption from municipal and state surtaxes and the application of autonomous taxation and the form of assessment and payment of the tax by UCITs.

It also clarifies the regime for taxation of income received by resident and non-resident partners or participants, as well as the nature of the income derived from units in real estate investment funds and from shares in real estate investment companies, of the tax withheld at source on the income arising out of the redemption of fund units and the acquisition value of fund units on a non-onerous basis.

The Circular further addresses the changes in Stamp Duty Taxation arising from the new regime and provides for practical examples of the application of the transitional legal regime envisaged for ongoing undertakings upon the entering into force of the new regime (1 July 2015).

Tax and Customs Authority

Collection Area

Circular Letter no. 90021, of 19 June

Payment of Personal/Corporate Income Tax withheld at Source & Stamp Duty – Changes in Codes

Discloses the codes used for identification of the nature of the income withheld and of the acts subject to Stamp Duty, their use being required from 1 July 2015.

Tax and Customs Authority

Collection Area

Circular Letter no. 30171/2015, of 30 June

Following the changes of the VAT rates in the Autonomous Region of Azores, producing effects from 1 July 2015, clarifies the applicable VAT rate at the moment when the VAT is due.