Invalid fines and VAT refunds: Sara Soares analyses the Portuguese Tax Authority’s actions
Sara Soares, Professional Partner at Abreu Advogados and specialist in Tax, analyzes the Portuguese Tax Authority’s (AT) practice of imposing fines for “failure to pay tax due” in cases where companies remain VAT creditors, even if for an amount lower than initially claimed.
In the article “When the Tax Authority Imposes Invalid Fines: The Case of VAT Refunds”, published by Jornal de Negócios, the lawyer explains that, in such situations, there is no tax missing from the State’s coffers, and therefore the alleged infraction does not legally occur.
Higher courts have repeatedly confirmed this interpretation, annulling fines of up to €45,000 and reaffirming that an improper deduction only constitutes an infraction when it reduces the tax actually owed to the State.
“This divergenc between the AT’s administrative practice and the judicial interpretation of the courts creates legal uncertainty for companies,” says Sara Soares, emphasizing the importance of knowing and defending taxpayers’ rights.
Read the full article here (available in Portuguese).
