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Fiscal Representative Portugal: Do I Need One?
Updated: September 19, 2023 | Natalia
If you have any financial ties or business in Portugal and are living outside of the European Union or European Economic Area, you need a tax representative in Portugal.
Why? Let’s imagine a scenario where you own an apartment in Portugal. The Portuguese tax and customs authority (autoridade tributária or Finanças) has realized that you owe them some taxes, and they need to contact you. Finanças, the tax authorities, will send a letter to your Portuguese or EU address if you are a Portuguese or EU resident. However, if you’re a non-EU resident, Finanças will not send a letter to your non-EU address.
This can result in the tax authorities losing money in taxes, causing legal and fiscal issues. To avoid this scenario, if you have any financial ties to Portugal, it’s mandatory to have a tax representative.
Who is a fiscal representative?
It is required by law that every non-EU resident who owns property maintains a bank account, or has any other type of commercial activity in Portugal appoints a representative (also known as a fiscal representative) who is registered with the Tax Department and has a Portuguese address.
A Portugal fiscal representative is an individual or business that serves as a point of contact between a non-resident person or business and the Serviço de Finanças.
What are the responsibilities of a fiscal representative in Portugal?
The fiscal representative in Portugal is responsible for passing communications from the Portuguese tax authority to the non-EU resident. Typically, responses to notifications from the Tax Department need to be made within 10 to 15 days.
They are also supposed to ensure that you comply with Portuguese tax laws. The fiscal representative advises you of the appropriate legislation, timelines, and tax obligations, e.g., making sure you deliver tax returns and that you make tax payments. They may incur fines and other penalties if these responsibilities are not met.
Who needs a tax representative in Portugal?
The following people are likely to require fiscal representation:
- Non-resident individuals in a legal tax relationship with Portugal, e.g. through the purchase of property or a car registered or situated within Portuguese territory
- Non-resident individuals who run a business or earn an income in Portugal, e.g., are self-employed in Portuguese territory or have a Portuguese work contract.
- Applicants for a NIF number who are from outside the EU/EEA.
Fiscal tax representation rule change
As of June 2022, the tax authorities, Finanças, introduced some minor changes to regulations surrounding tax representatives.
Previously, if you had received a NIF (número de identificação fiscal), lived in Portugal, and then moved outside of the EU to countries like the US or UK, you were obliged to have a fiscal agent. You couldn’t just stop using your NIF and had to turn to a representative or business, who you might have had to pay a fee indefinitely.
The rules have now changed so that you do not need a representative if you are a resident outside of Portugal or the EU and have no financial ties to Portugal. However, if you still have financial ties to Portugal, such as a home or a car, you do still need to have a fiscal representative as you are classified as a non-resident taxpayer.
NIF Tax Representatives in Portugal
Applicants for a NIF number who are from outside the EU/EEA
According to Portuguese tax law, non-resident taxpayers from outside the EU/EEA must appoint a fiscal representative and have fiscal tax representation if they do not have a permanent establishment or a fixed place of business in Portugal. The fiscal representative must be resident in Portugal and must have the appropriate knowledge and expertise to handle tax matters on behalf of their clients.
In practice, this means that if you are a non-EU/EEA resident applying for a NIF (Portuguese tax identification number) in Portugal, you will likely need to have fiscal tax representation. This can be a lawyer, accountant, or other professional with expertise in tax matters. They will help with your tax department correspondence.
Engaging the services of a fiscal representative can provide numerous benefits. For one, it can help ensure that you comply with Portuguese tax laws, which can be complex and confusing for non-experts. A fiscal representative can also help to streamline the tax process, handling administrative tasks on your behalf, including your tax obligations, and freeing up your time and energy for other pursuits.
The NIF process
The NIF (número de identificação fiscal) is a Portuguese tax identification number that is extremely important. It is essential to have the NIF if you have any financial business in Portugal. The tax department generally requires that you have this number for a variety of purposes – you need it for paying taxes, accessing social security, and opening a bank account.
If you plan to work, buy property, or carry out any financial transactions in Portugal, having a Portuguese fiscal number is essential. It is also required for non-residents who earn income from Portuguese sources, such as rent from property. Without a tax number, you may face difficulties in accessing financial services, opening bank accounts, paying income tax, and meeting your tax obligations. The NIF Portugal is a key element in operating successfully in the country.
You have two options: Either you can attend a NIF appointment in person at a local tax office with your representative or sign a power of attorney allowing your representative to apply on your behalf. The second option is ideal for anybody abroad or busy, as they do not need to be present in person, and the process can take place online. Your fiscal representative submits your documents and details to the Portuguese tax authority and then collects and forwards your Portuguese NIF number to you.
Fiscal representation and taxes
Having fiscal representation can also be a game-changer when it comes to tax. Your representative can advise you on matters of annual income taxes, income tax, tax deductions, and your tax returns. Being a represented taxpayer can thus save you money and fees later down the line.
If you’re a non-resident individual, you do not need to necessarily set up tax residence in Portugal and become a tax resident of the country. A NIF (taxpayer number) does not automatically mean you’re a tax resident in Portugal as long as your address is outside of Portugal. We’d recommend speaking with your accountant or representative, and they can advise you on this matter in greater detail.
Fiscal Representative Portugal Cost
Portuguese Fiscal Representative For Residents
Anyone who resides in Portugal can be your fiscal representative, so you don’t need to pay a lawyer. However, we recommend against appointing a friend or acquaintance as they might not know the complexities of the Portuguese tax system and could risk being fined or held liable for tax evasion. For this reason and because non-residents may not have connections in the local community, most non-residents choose to hire lawyers or professionals.
Fiscal Representation in Portugal For Non Residents
Non-EU residents applying for a NIF are usually charged by their fiscal representative for the process. In addition, most lawyers charge ongoing annual fees in exchange for fiscal representation. The cost of a fiscal representative in Portugal can range from anything between €50 to over €1,000.
GetNIFportugal charges €350 to connect you with a Portuguese lawyer who will act as your fiscal representative and request a NIF for you. We offer ongoing fiscal representation that includes forwarding messages from the Tax Office to you until you are assigned a new NIF tax representative (these services are charged at an annual fee of €350).
We offer tax representation and our GetNifPortugal service to every nationality.
Penalties For Not Having a Tax Representative in Portugal
As a general rule, non-resident taxpayers have 15 days to appoint a tax representative after it’s been determined that one is required. However, if you plan to initiate a professional activity in Portugal, you must appoint a tax representative immediately upon registering the activity with the Portuguese tax authority. The good news is that you can easily appoint a tax representative online through the Finanças website or visit a tax office or Citizen’s Bureau (Loja do Cidadão).
Failing to appoint a representative when mandatory or designating a representative without their express consent can lead to a penalty ranging from €75 to €7,500.
Additionally, you’ll be unable to exercise your rights before Finanças until the appointment is concluded. Don’t let a missed deadline or lack of representation hold you back from pursuing your business goals in Portugal.
I have a Fiscal Number in Portugal and do not have a Fiscal Representative. Is that a problem?
Having an NIF number and not having a fiscal representative could mean that you are wrongly registered at the Tax Department as a resident of Portugal for tax purposes. If that’s the case, you may be susceptible to declare your worldwide income in Portugal and pay taxes here.
In addition, any Tax Department correspondence could also be sent to the wrong address.
If your IMI property tax bill is sent directly by the Tax Department to your Portuguese property, it means you’re registered as being fiscally resident in Portugal.
Frequently Asked Questions about Fiscal Representation in Portugal
Who can be a tax representative in Portugal?
Those who are residents of Portugal are also eligible to be tax representatives. They must make themselves known to the tax authority in Portugal and have a Portuguese address in order to register. They will be able to assist you with tax department correspondence.
Why do I need a fiscal representative in Portugal?
Fiscal representatives are needed to ensure compliance with Portuguese tax laws and to receive contact from the Portuguese tax office. Engaging the services of a representative helps ensure that you are in compliance with Portuguese tax laws and can make the tax process smoother and more efficient.
Fiscal representatives are in charge of informing you about the rules and regulations of tax. This can include submitting tax returns, having them pay taxes on your behalf, and handling other administrative tasks related to taxation.
Who is a fiscal representative?
A fiscal representative in Portugal is a professional authorized to act on behalf of non-residents in all fiscal matters. This can include preparing and submitting tax returns, handling VAT registration, invoicing, payroll, and other fiscal matters that may arise.
The fiscal representative in Portugal acts as a point of contact between their clients and the Portuguese tax office, ensuring that their clients comply with Portuguese tax laws and regulations. They can also assist with obtaining a Portuguese taxpayer number for non-residents, which is essential for carrying out transactions in the country. The fiscal representative plays a critical role in helping individuals and businesses operate in Portugal.
How long does it take to get a NIF?
The NIF número de identificação fiscal) is a 9-digit Portuguese taxpayer number. If you’re attending an in-person appointment, you usually get your NIF in minutes.
However, if you’ve applied for a NIF online through a tax representative, it can take about one to three weeks to receive your NIF, depending on whether the tax office is experiencing delays.
How do I appoint a NIF tax representative?
To appoint a NIF tax representative, you must engage the services of a professional who is a tax resident in Portugal. This representative must then be registered with the Portuguese tax authority, known as the Serviço de Finanças.
Can I appoint any individual or company as my NIF tax representative?
Technically, anyone who resides in Portugal and is a tax resident can act as your NIF tax representative. However, it’s generally recommended to appoint a professional such as a lawyer, who is well-versed in the complexities of Portuguese tax law. This is to avoid potential fines or charges of tax evasion due to misunderstanding or misinterpreting tax laws and regulations.
How much does it cost to hire a NIF tax representative?
The cost to hire a NIF tax representative varies, but GetNIFportugal charges €350 to connect you with a Portuguese lawyer who will act as your fiscal representative and request a NIF for you. There’s also an annual fee of €350 for ongoing fiscal representation, which includes forwarding messages from the Tax Office to you until you assign a new NIF tax representative.
Can I change my NIF tax representative?
Representatives can be changed as long as the new representative is properly registered with the Serviço de Finanças and you alert Finanças about the change.
Is a NIF tax representative the same as a tax advisor or accountant?
A NIF tax representative is similar to a tax advisor or accountant in that they can handle fiscal matters such as preparing and submitting tax returns, handling VAT registration, invoicing, and payroll. However, a NIF tax representative specifically acts on behalf of non-residents and serves as a point of contact between them and the Portuguese tax authorities. Their role is to ensure their clients comply with Portuguese tax laws and regulations, which may go beyond the typical duties of a tax advisor or accountant.
How much does it cost to hire a fiscal representative in Portugal?
Fiscal representative Portugal cost can range from anything between €50 to over €1,000.
Who needs to appoint a fiscal representative in Portugal?
Non-EU and non-Portuguese citizens will require a fiscal representative when applying for a NIF number in Portugal. A NIF number is required to make any fiscal transactions in Portugal, including having to pay taxes, buy a house, or open a bank account. They will be able to help with any dealings you have with the Portuguese tax authorities.
Do I need a fiscal representative in Portugal after Brexit?
Yes, non-EU and non-Portuguese citizens will require a fiscal representative when applying for a NIF number in Portugal. They will assist you with any dealings you have with the Portuguese tax authorities and will help with your tax department correspondence.
Do non-residents in Portugal pay taxes?
Yes, non-residents in Portugal are subject to tax on income obtained in Portugal, such as dividends, capital gains, and royalties.
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