Portugal – Are you Ready for the Changing Stamp Duty Reporting Requirements and What Lies Ahead?

Ana Cristina Cardoso
August 18, 2020

With the fast pace of change happening on the global tax landscape, where tax authorities require more granular information with electronic tax submissions, it’s not surprising to see another country embarking on their digital journey. Portugal is now following in the footsteps of other nations by changing the way in which stamp duty is declared. This was initially due to be introduced for the January 2020 return but was postponed to April 2020 and then delayed further due to COVID-19 until January 2021.

Stamp duty is the oldest tax in Portugal, and one of the oldest taxes still in existence in Europe, having been created by Royal Decree in 1660. Since its creation, few changes have been made to the Settlement and Exemption’s control system.  Contrary to what happen with other taxes, little progress has also been made regarding the verification of the amounts paid versus actually delivered to the State and the tax benefits granted. The current system is unable to control the settlement of stamp duty as there is no declaration or settlement system that allows the tax assessment and benefits to be efficiently verified.

The aim of the new system is for the tax authority to obtain both accurate data on the real amounts due for statistical and control purposes.  Ordinance no. 339/2019 of October 1, sets up and approves the official model of the Monthly Stamp Duty Declaration, as well as the obligation of the Monthly Stamp Duty Declaration’s electronic submissions for all transactions, even those exempt from stamp duty.

Required information

These changes introduced the obligation for insurers to collect, disclose and submit additional information in their Monthly Stamp Duty Declaration. This information is required for a successful submission, and includes:

  • Policyholder’s tax ID: Tax ID issued by the policyholder’s country of residence
  • Policyholder’s country code: The code of the policyholder’s country of residence which should be the country issuing the policyholder’s tax ID
  • Territoriality: The exact location where the insurance premium has been issued from i.e. inside or outside the Portuguese territory
  • Insured risk’s location in Portugal: The postcode of the area or region where the risk is located i.e. continent (mainland)/Azores/Madeira, since the Portuguese tax authorities require the stamp duty to be filed regionally.

What lies ahead?

Postponement of the new requirements to January 2021 gives insurers more time to prepare their systems to gather the mandatory information required and ensure complete and accurate reporting.

Law Decree no. 119/2019 revokes the “offsetting” mechanism relating to the tax delivered in previous periods which allowed insurers to deduct the amount overpaid against future liabilities. Instead, it stipulates that whenever there are changes to the amounts previously declared insurers must submit a Replacement Declaration. If the previously declared tax is higher than that actually due, the Tax and Customs Authority will reimburse the excess amount until the end of the second month following the submission of the replacement declaration.  This is providing that it has been delivered within one year and does not contain any filling errors.  If the Replacement Declaration results in an amount higher than that previously paid, fines for missing tax may be imposed in addition to the payment of the difference.

This Law Decree also provides the possibility for insurers to file a Gracious Claim whenever there is an improper settlement. This mechanism should be used to request a refund of negative amounts for policies declared prior to January 2021.

Take Action

Keep up to date with ever changing rules by subscribing to our blogs and following us on LinkedIn and Twitter. We also host regular webinars with our in-house specialists who are on hand to help.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.


Ana Cristina Cardoso

As a Compliance Services Supervisor, Ana Cristina leads the Country Team, an integral part of IPT Managed Services at Sovos. Having joined Sovos in March 2017, she has worked in a number of roles which provided her with a deep knowledge of IPT, enabling her to ensure that tax compliance and submissions comply with the several tax authorities.
Share This Post

North America Sales & Use Tax
June 1, 2023
3 Things to Remember if You Get a Sales Tax Notice

Have you ever received a sales tax notice from a state department of revenue? Whether you answered yes or no, there are important things to keep top of mind to help keep your business prepared. Finding out that you have failed to comply with one or more of your sales tax obligations can be startling. […]

North America Unclaimed Property
May 30, 2023
How to Set Up a Successful Unclaimed Property Program

Unclaimed property compliance can be difficult and overwhelming. Clients often ask what they should be doing to ensure they are compliant with the various laws and regulations. It isn’t easy, especially if you have multiple property types such as checks, credits or customer accounts that have the potential to become unclaimed property in multiple states. […]

North America ShipCompliant
May 30, 2023
How Hold At Locations Improve Your Customers’ Wine Delivery Experience

Direct-to-consumer shipping wine lovers enjoy the convenience of having their favorite vinos shipped to their front door. But what happens when, for whatever reason, they aren’t available to accept their wine deliveries? Whether they aren’t available during the day or they don’t have someone 21 or older available to sign for their package, these challenges […]

North America Sales & Use Tax
May 30, 2023
Identifying Sales Tax Liabilities and Why They Matter

By Steve Claflin, CLA It’s incredible that it has now been five years since the landmark Wayfair decision. It seems like just yesterday we were reading the case, alerting clients and tracking the ever-developing state guidance. Unfortunately, many companies still are not familiar with their sales tax filing obligations caused by economic nexus, or they […]

North America ShipCompliant
May 25, 2023
Out-of-State Breweries Gain Self Distribution, DtC Rights in Oregon

Under a settlement agreement, breweries located outside of Oregon now have more options for selling into the Beaver State, including direct-to-consumer (DtC) shipping and self-distribution to retailers. The settlement arose out of a lawsuit filed by a group of Washington breweries last year challenging Oregon laws that limited beer self-distribution to in-state breweries and DtC […]