A green receipt is the document delivered by the self-employed person / self-employed person to the person or company to whom he provided the service.with the computerization of finance, the document is issued electronically on the Finance Portal, and is no longer a physical document on paper, as it was for many years.
You will need to have a NIF (“Número de Identificação Fiscal”) which is a taxpayer identification number, the IBAN of a Portuguese bank account in your name and you have to be registered in the Portuguese tax system as being self-employed or a freelancer.
The service you will provide. Most freelancers are part of the list in Article 151 of the CIRS.Date of the beginning of your activity. It is really, really important that you only start your activity after you have opened your activity with the tax authority.
The amount you estimate you will earn until the end of that fiscal year (January to December). This will determine if you will have to pay VAT or not. If you earn more than €10,000 per year, you will have to include VAT .
Your IBAN of your bank account. You need to fill in your IBAN in order to associate a bank account to your tax profile.
It is the more common one and, as the name suggests, it is simple. This is the one you will get by default from the tax authority.
You will not need an accountant and your situation will not change unless you earn more than €200,000 a year.
If you earn more than €200,000 per year, you are obligated to have an accountant and that will cost you between €150 and €250 per month. Your accountant will handle both the Finanças and the Social Security.
VAT (Value Added Tax) in Portugal
The next question you will probably face is: Do I have to charge VAT or not for my services?
Do my bills or invoices have to show the VAT value or am I exempt from VAT?
Well, as we mentioned before, it all depends on whether you anticipate earning more than €10,000 per year for your services or not.
In case you will not cross the €10,000 per year limit, you are exempt from VAT and that must be written on your bills or invoices. That means you don’t need to add it to your service value.
You must be careful with one thing, though: If you end up earning more than €10,000 in one year, you have to declare that to the state and you have until the month of January of the following year to do so.
Now imagine you know you will earn more than €10,000 per year. You have to charge VAT on top of your normal fee. And then, you will have to declare the value of the VAT you have received from your clients to the state on a quarterly basis.
The limit is the 15th of the second month after the quarter.
This means that if you received €X in VAT from 1 January until 31 March, then you have until 15 April to declare it and pay it to the state.
Every person that has any income in Portugal must declare it and freelancers are no exception. Any person who has an open activity must do the same, even if they earned nothing for the year.
This is a declaration you have to fill in every year in order for the state to evaluate if the taxes you have been paying during the year (VAT, Retention, etc.) were accurate.
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