The Portuguese Tax Authority (PTA) declared, through the Circular Letter number 90054, of June 6, that the appointment of a tax representative was mandatory if, after the allocation of a taxpayer number as a non-resident and as a resident in a third country, i.e., a country not part of the EU or of the EEA, the taxpayer became subject to a tax legal relationship in Portugal.
A tax legal relationship would exist when the non-resident was the owner of a vehicle or property located in Portuguese territory, when the taxpayer had an employment contract in Portuguese territory, or when the taxpayer exercised a self-employed activity in Portuguese territory.
The new wording of article 19 of the General Tax Law (GTL) declares that “The obligation to appoint a tax representative does not apply to taxable persons who subscribe to the public service of electronic notifications associated with the single digital address, the regime of electronic notifications and citations on the Tax Authority website or the electronic mailbox, with exception to the provisions regarding legal persons or other legally equivalent entities that cease their activity”.
It was intended, in this way, to “de-bureaucratise” the obligation to appoint a tax representative, recognising that, as a result of the technological evolution that has been taking place, there are now alternative means (to the common mail and physical format) that may be sufficient and adequate in cases where the taxpayer is the subject of a tax legal relationship to guarantee, on the one hand, the fulfilment of tax obligations and, on the other hand, the possibility of exercising their rights.
Following that amendment to the GTL, through Decree-Law number 44/2022, of July 8, the PTA issued the Circular Letter number 90057, of July 20, to clarify the scope of the obligation to appoint a tax representative for taxpayers who qualify as non-residents in Portugal (and residents in a third country) but that maintain a relevant tax legal relationship here.
The new Circular Letter says that “If the taxable person, resident in a third country, subscribes to any of the dematerialized notification channels (electronic notifications and citations system on the Tax Authority’ website or to the electronic mailbox), he is dismissed from the obligation to appoint a tax representative”.
As such and considering the provisions of the aforementioned Decree-Law 44/2022, of July 8, the PTA clarifies that taxpayers who wish to be dismissed from this obligation are allowed to do so, provided that they subscribe to the electronic notifications and citations on the Tax Authority website or the electronic mailbox.
– taxpayers who choose to subscribe a dematerialized notification channel may be dismissed from appointing a tax representative, according to the Circular Letter number 90057, of July 20;
– cases in which the taxable person carries out an activity, as an independent worker, within the Portuguese territory, remain outside of the scope of this dismissal. In those situations, and whenever applicable, remains the obligation to appoint a tax representative, who must, cumulatively, be subject to VAT and have a tax residence in Portugal;
– failure to appoint a tax representative, when this is required, as well as failure to appoint a representative who does not expressly accept the representative’s appointment, is punishable by a fine of between €75 and €7,500, and the non-resident taxpayer is unable to exercise his rights before the PTA, including the ones of complaint, appeal or impugnation.
By Dr Eduardo Serra Jorge
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Dr Eduardo Serra Jorge is founding member, senior partner and CEO of lawyers firm Eduardo Serra Jorge & Maria José Garcia – Sociedade de Advogados, R.L., created in 1987.
In his column, he addresses legal issues affecting foreign residents in Portugal.
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