Portugal VAT Group regime 1 July 2026

Portugal is one of the last of the EU states group VAT regimes to be launched. RGIVA enables corporate groups to streamline their tax management, strengthen their competitive position, and improve overall cash flow efficiency.

See more in our Portugal VAT Guide.

Portugal Confirms VAT Group Returns from July 2026

Portugal has published the official VAT Group declaration and filing instructions ahead of the launch of its new VAT grouping regime (RGIVA) on 1 July 2026.

The publication is the final compliance step following the introduction of VAT grouping under Law No. 62/2025. Portugal is one of the last major EU Member States to introduce a full VAT group regime, bringing it into line with many other European jurisdictions that already allow related companies to be treated as a single VAT taxable person.

The new regime is designed to simplify VAT administration, improve cash flow management and reduce unnecessary VAT costs within corporate groups by allowing VAT positions to be consolidated.

Why VAT groups matter

Under RGIVA, VAT balances can be offset across group members, avoiding situations where one company is due a VAT refund while another member of the same group has VAT to pay.

In addition, supplies between group members are disregarded for VAT purposes, reducing internal invoicing complexity and simplifying compliance.

Who can form a VAT group?

To qualify, group members must be closely linked financially, economically and organisationally.

The parent company must:

• Hold at least 75% of the share capital of each subsidiary
• Control more than 50% of voting rights
• Have held the qualifying participation for more than one year before joining the regime

Indirect ownership is permitted, with participation percentages calculated through the ownership chain. Newly incorporated subsidiaries may join immediately if the ownership conditions are met.

Group members must also:

• Have a registered office or permanent establishment in Portugal
• Carry out activities giving rise, wholly or partly, to input VAT deduction
• Operate under the normal Portuguese VAT regime with monthly filing obligations

A parent company cannot itself be controlled by another Portuguese dominant entity and businesses cannot participate in multiple VAT groups simultaneously.

How the new filing process works

The newly approved VAT Group declaration introduces a centralised filing process.

Each member of the VAT group continues to calculate its VAT position individually and submit its own periodic VAT return by the 10th day of the second month following the reporting period.

The Portuguese Tax and Customs Authority (AT) will then automatically generate a pre-filled VAT Group declaration using the information submitted by all members.

The dominant entity must:

• Review the pre-filled declaration
• Confirm the consolidated VAT position
• Submit the VAT Group return by the 20th day of the second month

Any VAT due must be paid by the 25th day of the second month.

If the dominant entity fails to confirm the declaration by the deadline, the pre-filled return will be automatically submitted by the tax authority.

Treatment of VAT credits

The legislation contains detailed rules governing VAT credits.

Where the VAT Group return produces an overall credit balance, the amount may either:

• Be carried forward to future periods; or
• Be claimed as a VAT refund

However, if the dominant entity fails to confirm the pre-filled declaration before the deadline, any credit balance will automatically be carried forward and cannot be claimed as a refund.

Credits generated before an entity joined the VAT group remain ring-fenced. These historic credits may only be offset against that specific entity’s own VAT liabilities and cannot be freely shared across the group.

Three years ongoing obligations

The regime includes a minimum participation period of three years.

Groups must also notify changes including:

• Admission of new members
• Exclusion of members
• Changes in control structures
• Replacement of the dominant entity

Any amendments made to an individual member’s VAT return will automatically trigger a corresponding correction to the VAT Group declaration.

Where a member fails to file its own VAT return, the tax authority may issue an estimated assessment using available data, but the VAT Group remains responsible for meeting payment deadlines.

Importantly, group members are jointly and severally liable for VAT debts arising under the regime.

What businesses should do now

Although the filing process is heavily automated through pre-filled declarations, groups should not underestimate the preparation required.

Eligibility conditions, ownership structures, historic VAT credits, monthly filing obligations and joint liability provisions all require careful review before joining the regime.

Multinational groups with Portuguese subsidiaries should also assess how the new VAT grouping rules interact with existing VAT recovery processes, transfer pricing arrangements and ERP reporting structures ahead of the July 2026 launch.