VAT Exemption Calculator (Article 53) 2026
Portugal's article 53 VAT exemption covers activities invoicing up to €15,000/year. Exceed €15,000 but stay at or below €18,750 and you exit the exemption on 1 January; exceed €18,750 (25% above the threshold) and VAT applies immediately, with 15 business days to file an amendment declaration. In your first year, the turnover you estimate for that year counts.
How the regime works
- Threshold — €15,000 of annual turnover in Portugal (in the starting year, your estimate for that year).
- Normal exit — above €15,000 up to €18,750: exemption ends the following 1 January.
- Immediate exit — above €18,750: charge VAT right away + amendment declaration within 15 business days.
- Waiver — possible, to deduct input VAT; binds you to the normal regime for 5 years.
Legal basis
The small-business exemption is in articles 53 onwards of the Portuguese VAT Code, rewritten by Decree-Law 35/2025 of 24 March. It covers taxpayers based in Portugal who do not export or carry out related activities and whose turnover in Portugal did not exceed €15,000 in the previous calendar year (article 53(1)). In return they cannot deduct input VAT (article 53(3)). Decree-Law 35/2025 also stopped excluding businesses with organised accounts or that import goods.
Exit follows article 58: if you exceeded €15,000 last year, you charge VAT from 1 January and file the amendment declaration within 15 business days of the year end; if you exceed the threshold by more than 25% (€18,750) during the year, VAT is due from that moment and the declaration is due within 15 business days (article 58(4) and (5)). Waiving the exemption keeps you in the normal regime for at least five years (article 55(3)).
Worked examples
A designer invoiced €14,000 in 2025 and is exempt in 2026. If she reaches €17,000 in November 2026, she keeps invoicing without VAT until 31 December, moves to the normal regime on 1 January 2027 and files the amendment by the 15th business day of January. If instead she reaches €19,000 in September, she is above €18,750: she charges VAT from that moment and has 15 business days to file. Someone starting in October with a €12,000 estimate for that year is exempt — the estimate is not annualised.
Freelancing in Portugal? See the freelancers guide and the green receipts simulator. Specific cases (imports, waivers) deserve case-by-case advice — talk to us.
Frequently asked questions
What is the article 53 VAT exemption?
The Portuguese regime that exempts small activities from charging VAT when annual turnover stays at or below €15,000 — typical for freelancers. Exempt businesses charge no VAT to clients but also cannot deduct VAT on purchases.
What happens if I exceed €15,000?
If you exceed €15,000 but stay at or below €18,750 (25% above), you lose the exemption on 1 January of the following year. If you exceed €18,750, VAT applies immediately to your operations and you must file an amendment declaration within 15 business days.
How is the threshold assessed in the first year of activity?
On the turnover you estimate for the current calendar year in your start-of-activity declaration, compared directly with €15,000 and not annualised (article 53(5) of the VAT Code, as amended by Decree-Law 35/2025).
Can I waive the exemption?
Yes. Waiving lets you deduct VAT on purchases and investments, but binds you to the normal VAT regime for a minimum of 5 years.
Do exempt freelancers still issue invoices?
Yes, always — with the mention "IVA — regime de isenção" (article 53). All other filing obligations remain.