COVID-19 – Tax measures for cooperatives, micro, small and medium sized companies

In brief

Law 29/2020, of 31 July, published in the Official Gazette, establishes COVID-19 pandemic related tax measures to support cooperatives as well as micro, small and medium sized companies (SME), as per the definition in article 2 of the annex to Decree-Law 372/2007, of 6 November.

In detail

The following measures are foreseen:

I – Payments on account of CIT: temporary suspension

Cooperatives, as well as micro companies and PME are allowed not to make the payments on account of CIT foreseen in articles 105 and 107 of the CIT Code, regardless of the fact that the respective payment can be made in extended deadlines as established in Notice 104/2020-XXII of the State Secretary of Tax Affairs, of 9 March 2020.

II – Special Payment on account of CIT: temporary suspension and early refund

Cooperatives, as well as micro companies and PME are allowed not to make the special payment on account of CIT foreseen in article 106 of the CIT Code.

In 2020, these entities are also allowed to request an early refund of the special payment on account that was not deducted until 2019, without the need to observe the deadline foreseen in article 93 no. 3 of the CIT Code.

III – Deadline for refunds of VAT, CIT and PIT

The refund of withholding taxes, payments on account or VAT in excess of the amounts due is made within 15 days following the fling of the respective return by the taxpayer.

This Law enters into force on 1 August 2020. It applies until the end of the year in which the extraordinary and temporary COVID-19 pandemic measures cease to apply.

^{© 2020 PwC. This communication is of an informative nature and intended for general purposes only. It does not address any particular person or entity nor does it relate to any specific situation or circumstance. PricewaterhouseCoopers Tax Services TLS, Lda. We will not accept any responsibility arising from reliance on information hereby transmitted, which is not intended to be a substitute for specific professional business advice.}