Choosing between monthly and quarterly VAT reporting in Portugal can significantly impact your cash flow and administrative burden. Here’s what you need to know.
Monthly VAT Regime
Who must use it: Companies with annual turnover exceeding €650,000 are required to submit monthly VAT returns.
Advantages:
- Faster VAT refunds when in credit position
- Better cash flow management for import/export businesses
- More accurate financial tracking
Disadvantages:
- Higher administrative workload (12 submissions/year)
- Shorter deadlines – submit by 10th of following month
- More frequent reconciliation required
Quarterly VAT Regime
Who can use it: Companies with annual turnover below €650,000 can opt for quarterly reporting.
Advantages:
- Less administrative burden (4 submissions/year)
- More time to gather and verify documentation
- Better for businesses with stable, predictable VAT
Disadvantages:
- Slower VAT recovery
- Larger lump-sum payments required
- More challenging cash flow planning
How to Change Regime
You can request a regime change through the AT Portal (Portal das Finanças). Changes typically take effect at the start of the next calendar year.
EasyFin Recommendation
Our analytics can help you simulate both scenarios based on your actual data, showing the cash flow impact of each regime.