Portugal’s tax authorities have issued July 2026 guidance on credit notes, VAT adjustments and the revised periodic VAT return, with some measures taking effect from 1 July 2026.
Portugal’s tax authorities issued Circular Letter No. 25120/2026 on 28 July 2026, updating procedures for invoice rectification and VAT adjustments. The guidance confirms that credit notes should be used when the taxable value or VAT amount changes, but not to correct formal errors that do not affect VAT.
For formal errors, such as incorrect NIF, address or customer identification, the original invoice should be annulled in the billing system and replaced with a corrected invoice without a VAT adjustment.
The guidance also recognises electronic evidence, including electronically signed documents, billing-platform records, customer portal access logs and written correspondence, to demonstrate that a buyer was informed of a VAT correction. Deemed acceptance clauses are not sufficient.
Revised periodic VAT return
Circular Letter No. 25119, dated 22 July 2026, provides guidance on Ordinance No. 298/2026/1, dated 16 July 2026, which approved a new template for the periodic VAT return and related annexes.
Changes taking effect from 1 July 2026 include reporting requirements for the new Portuguese VAT group regime and adjustments linked to Item 2.42 of List I annexed to the Portuguese VAT Code. Most other changes will apply to VAT periods starting on or after 1 July 2027.
Housing-related VAT adjustments
The guidance covers VAT regularisations linked to Decree-Law n.º 97/2026, which introduced the reduced VAT rate (Item 2.42 of List I) for certain housing projects. Taxpayers must report relevant adjustments in the designated fields and annexes.
Where taxpayers become eligible for the reduced rate after initially applying the normal rate, an adjustment in favour of the taxpayer may be made within the applicable 4-year statute of limitations, subject to the legal requirements.
Transitional measure
A transitional rule allows billing software to use certain procedures for replacing invoices until 31 December 2026, giving suppliers time to adapt systems to the updated credit note and debit note requirements.
