Tax and Customs Authority

Tax Management Area – VAT

Circular letter No 30169, of 5 February 2015

Agricultural products – Flat-rate compensation

Explains the flat-rate scheme for farmers, added to the VAT Code by Law No 82-B / 2014 of 31 December.

This Circular Letter addresses the scope of the scheme, the obligations of  taxable persons, the procedure of option for this scheme, the cases of cessation of the same and the flat-rate compensation system to be applied to the TCA.

Tax and Customs Authority

Office of the Director-General

Circular Letter No 3/2015, of 6 February 2015

Personal Income Tax (IRS) – Withholding tax rates tables - Madeira

Publishing withholding tax rates tables for Personal Income Tax (IRS) for earners of income from employment and pensions who are residents for tax purposes in the Autonomous Region of Madeira, to be applied in 2015.

Tax and Customs Authority

Office of the Director-General

Circular Letter No 4/2015, of 25 February 2015

Municipal Tax on Real Property (IMI) – Tax Advantage – Urban properties intended for the production of energy from renewable sources

Clarifies the scope of the tax advantage of reduction for five years, of 50% of the rate of the Municipal Tax on Real Property taxes (IMI) for urban properties intended for the production of energy from renewable sources, introduced by Law No 82-D / 2014 of 31 December.

Particularly noteworthy is the fact that, with regard to urban properties exclusively used in the production of energy from renewable sources prior to the effective date of this advantage, the reduction in question covers the 2015 tax, to be paid in 2016, should the application for its recognition be submitted within sixty days from the date of entry into force of the Law No 82-D / 2014 of 31 December.

If the application for recognition is made after this time limit, the beginning of the rate reduction of the Municipal Tax on Real Property takes place from the year following the submission of the application for its recognition.

Tax and Customs Authority

Excise Taxes and Vehicle Tax Services

Circular-Letter No 35041, of 6 February 2015

Tax incentive for the destruction of end-of-life vehicles – Proof of electric mode autonomy

Disclosing that, for the purposes of tax incentive procedures for the destruction of end- of-life vehicles, which takes the form of reduced tax on vehicles up to the amount of €3,250 in the introduction of a hybrid plug-in new vehicle without  registration, the submission of the document “Whole Vehicle Type Approval” (WVTA) for the purpose of proving the minimum 25 km range in electric mode may be dispensed in case of submission of the certificate of conformity of the vehicle or the corresponding model sheet issued by Instituto da Mobilidade e dos Transportes, I.P. (IMT, I.P.), expressly stating the vehicle’s autonomy in the electric mode.

It is further disclosed that this procedure will be in force until the autonomy in the electric mode of plug-in vehicles is included in their technical approvals granted by IMT,

I.P. and made available in the Car Taxation System.

Tax and Customs Authority

Excise Taxes and Vehicle Tax Services  Circular Letter No 35042, of 20 February 2015

Contribution on light plastic bags - Voluntary Declaration

In connection with the contribution on light plastic bags and following Decree No 850- A/2015 of 26 January, this Circular makes known that, for reasons that customs and customs offices deem justifiable and by prior contact by the interested parties, applications for the voluntary declaration of light plastic bags owned, in respect of which the said contribution has not yet been assessed and paid, sent by the  economic operators by email or by post, may be accepted.

This Circular also provides a model of the application of that voluntary declaration and a list of customs and customs offices contacts where the voluntary declaration may be made.

Tax and Customs Authority Personal Income Tax Services

Circular Letter No 20174, of 26 February 2015

IRS – Form Model 3

Disclosing the main changes made to each of the new Form Model 3 for IRS, approved by Ordinance (Portaria) No 276/2014, of  26 December,  which entered into force on 1 January 2015.

Tax and Customs Authority

Information Statement

Case No 8006, with concurring decree of 4 February 2015 of the DeputyDirector General of VAT

VAT – Rates – Fruit Juices and Vegetables

In this information statement, the TCA clarifies that, despite the fact that item 1.11. of List I attached to the VAT Code subjects to a reduced tax rate «fruit and vegetables juices and nectars», those same juices, where offered in kiosks located in shopping centres in the healthy food sector, are not covered by such reduced tax rate.

It is the opinion of the TCA that those juices and vegetables are, in this case, provided in the scope of a food and beverage service and are therefore subject to the standard tax rate.

Tax and Customs Authority

Information Statement

Case No 2013003576 – IVE No 6189, with concurring decree of 5 February 2014, of the Director General of the TCA, divulged on 24 February 2015

IMT (Municipal Tax on Real Estate Transfer) exemption – Insolvency – Formation of new companies

In this information statement, the TCA examined the scope of the exemption from Municipal Tax on Real Estate Transfer (IMT) provided for in Article 270(1)(a) of the Insolvency and Corporate Recovery Code.

This article provides that "the following transfers of real property, falling within any insolvency, payments or recovery plan, are exempt from Municipal Tax on Real Estate Transfer: a) those intended for the formation of a new company or companies and the payment of its capital; [...]».

In this information statement, the TCA considered that only corporate realities intended to operate establishments of the insolvent entities must be held as falling within this provision.

That is, property transfers forming part of an insolvency, payments or recovery plan, which are intended for the formation of  new  companies that have some continuity connection with  the insolvent company and are intended for the operation  of their establishment shall be exempt from IMT.

Tax and Customs Authority

Binding Information

Case No 2013003575 – IVE No 6176, with concurring decree of 19 February 2014, of the Director-General of the TCA, divulged on 24 February 2015

Purchase  of  properties  for  resale  –  Exemption  from  Municipal  Tax  on  Real Estate Transfer – Beginning of Limitation Period – Properties acquired within tax enforcement proceedings

In this Binding Information, a taxpayer inquired the TCA on the time when the three-year time-limit of exemption from IMT starts to run in case of purchase of a property for resale within tax enforcement proceedings: if the exemption period begins on the date of delivery of the Form 1 concerning the IMT, on the date of payment of a third of the price or on the date of full payment of the price.

The TCA began by noting that the sale in tax enforcement proceedings has special features which should be taken into account, in particular, that in sales with a value of more than 500 times the unit of account, the deposit of only part of the price, not less than one third, may be allowed, with the delivery of the remainder being made within no more than eight months - as indeed happened with the taxpayer in question.

Then, the TCA considered that, in line with the provisions of the Code of Civil Procedure, the final transfer is only realized with full payment of the price and that the contract award following the electronic auction is a temporary award act, which cannot fall within the general notion of liability to IMT.

The TCA then concluded that only the act determining the final award of the asset in favour of the proposed acquirer brings about and consolidates the transfer for  the purpose of liability to IMT and is therefore the relevant time at which the exemption period provided for in Article 11(5) of the Code of IMT starts to run.