Personal scope of application As per 26 June 2022

Are there any deviations from the Directive in defining the intermediary?

2021/06/17

Yes. Portugal excludes from the definition of the intermediary one that simply provides a description of the Portuguese tax framework or advises on a situation that is already in place.

How is an intermediary defined? Is there a differentiation between a corporate entity and an individual person?

2021/06/17

An intermediary is a person that designs, markets, organises or makes available for implementation or manages the implementation of an arrangement. There is no differentiation between a corporate entity/advisor. Individual advisors can qualify as Intermediaries.

Can a corporate tax department (or its members) within a MNE or within a group of entities qualify as an intermediary?

2021/06/17

This is not expressly foreseen. However, the PTA has already clarified that a person bound to the intermediary by a contract of employment does not qualify as an intermediary, even though his / her activity falls under the definition of “intermediary”. Furthermore, when no intermediary is involved, if there is a tax arrangement to report, the obligation lies on the taxpayer / MNE.

How are the actions of designing, marketing, organizing, making available for implementation or managing the implementation of a tax arrangement defined?

2021/06/17

Not specifically defined.

Have the legal preconditions regarding the territorial nexus for an intermediary been implemented in accordance with the Directive?

2021/06/17

Similar to the Directive. However, it requires that the intermediary have some connection with the Portuguese legal system, be it: (a) having fiscal residence in Portugal;(b) having a permanent establishment in Portuguese territory, from which he/she provides services related to the arrangement; (c) being incorporated or governed by Portuguese Law;(d) being registered with a professional association for legal, tax or advisory service.

Are there any other conditions apart from those of the Directive, such as the territorial nexus of a tax arrangement to a certain Member State, which trigger a reporting obligation of an intermediary (e.g. including intermediaries from outside the EU)?

2021/06/17

Reporting duties are also levied upon a person who - having met one of the conditions above specified - has the necessary know how to provide such a service and knows (or should have known) that he/she has agreed to provide advise in the design, commecialization, organization or deployment of an arrangement or to manage such an arrangement.

In which cases is the relevant taxpayer obliged to report? Are there deviations from the Directive?

2021/06/17

Three possible scenarios that generate a reporting duty for the relevant taxpayer: (a) when there is no intermediary involved and a tax arrangement is applied;(b) the relationship with the intermediary is bounded by legal/contractual privilege;(c) the intermediary is not resident in Portugal.

Are there any other persons beside intermediaries or relevant taxpayers obliged to report?

2021/06/17

There are no deviations from the Directive.

Are there any deviations from the Directive in defining the relevant taxpayer?

2021/06/17

There are no deviations from the Directive.

Mechanism to avoid multiple reporting

Which measures have been taken to avoid multiple reporting obligations referring to an intermediary obliged to report in several countries? Are there deviations from the Directive?

2021/06/17

There are no deviations from the Directive.

Which measures have been taken to avoid multiple reporting obligations referring to more than one intermediary obliged to report? Are there deviations from the Directive?

2021/06/17

There are no deviations from the Directive.

Which measures have been taken to avoid multiple reporting obligations referring to a relevant taxpayer obliged to report several countries? Are there deviations from the Directive?

2021/06/17

There are no deviations from the Directive.

Which measures have been taken to avoid multiple reporting obligations referring to more than one relevant taxpayer obliged to report? Are there deviations from the Directive?

2021/06/17

There are no deviations from the Directive.

How does the National Tax Authority expect the conditions for exemption from filing a report to be met?

2021/06/17

The intermediary or the taxpayer must provide documentation to the relevant tax authorities attesting the relevant information was already communicated in other Member State(s). For such, the intermediary or the taxpayer has 10 days counting from the deadlines foreseen above.

Material scope of application

Are national tax arrangements subject to reporting under the Directive?

2021/06/17

Yes, but only the ones concerning specific Hallmarks (i.e.: B1, B2, B3, D1, D2, and E2).

Which taxes are affected? Are there deviations from the Directive?

2021/06/17

All domestic taxes, including VAT(for internal mechanisms).

Does the hallmark catalogue deviate from the Directive? If yes, to what extent?

2021/06/17

To include certain domestic transactions.

Which hallmarks are linked with the main benefit test?

2021/06/17

Differs slightly from Directive, having determined a more restricted scope of application (only included Hallmarks A, B, and C1iii and C1iv).

How is the main benefit test defined?

2021/06/17

Similar to the directive. However, it requires that no reasonable doubt exists in regard to the main purpose being of tax nature.

How is a tax advantage defined?

2021/06/17

The concept includes any reduction, exemption or deferral of the tax. The report of tax losses or the concession of tax benefits (not obtainable without the use of the arrangement) falls within the scope of this definition of advantage.

Are there any deviations from the Directive in defining a cross-border arrangement?

2021/06/17

Mostly in line the directive, excluding the strict description of the Portuguese tax framework applicable to a given situation or the advice on a situation that is already in place.

Is there a white list defining arrangements explicitly excluded from a reporting obligation? If yes, please provide details.

2021/06/17

There is no white list.

Are there any deviations from the Directive in defining associated enterprises?

2021/06/17

There are no deviations from the Directive.

Reporting process

When is a cross border arrangement made available for implementation (e.g. handover of contract documents)?

2021/06/17

There is no specific guidance. Same as in the Directive.

When is a cross-border arrangement ready for implementation?

2021/06/17

There is no specific guidance. Same as in the Directive.

When has the first step in the implementation of a cross-border arrangement been made?

2021/06/17

There is no specific guidance. Same as in the Directive.

Which information should be included in the report? Are there deviations from the Directive?

2021/06/17

There are no deviations from the Directive. The report should include the following information:(a) information about the intermediary, including the name, date, and place of birth (for individuals) or company name (for legal persons), address, the residence for tax purposes, TIN; and information about the user: name, date, and place of birth (for individuals) or company name (for legal persons), address, the residence for tax purposes, TIN; and information about associated enterprises;(b) details of the hallmarks;(c) a summary of the content of the reportable cross-border arrangement, including a reference to the name by which it is commonly known, if any, and description in abstract terms of the relevant business activities or arrangements, without leading to the disclosure of a commercial, industrial or professional secret or of a commercial process, or of information the disclosure of which would be contrary to public policy;(d) the date on which the first step in implementing the reportable cross-border arrangement has been made or will be made;(e) details of the national provisions that form the basis of the reportable cross-border arrangement;(f) the actual or foreseeable value of the reportable cross-border arrangement;(g) the identification of the Member State of the relevant taxpayer(s) and any other Member States which are likely to be concerned by the reportable cross-border arrangement;(h) the identification of any other person in a Member State likely to be affected by the reportable cross-border arrangement, indicating to which Member States such person is linked.

What does the reporting process look like? Are there deviations from the Directive?

2021/06/17

There are no deviations from the Directive.

Is the entire report to be provided by the intermediary/relevant taxpayer? Who must provide the report?

2021/06/17

In line with n.º 7 and 8 above.

What are the respective deadlines for the intermediary and the relevant taxpayer to file the report? Are there deviations from the Directive in terms of filing the information within 30 days?

2021/06/17

There are no deviations from the Directive.

Which numbers are assigned by local tax authorities to the cross-border arrangements?

2021/06/17

No information is available so far.

What is the reporting deadline for arrangements the first step of which was implemented between 25 June 2018 and 30 June 2020?

2021/06/17

28.02.2021.

When is the reporting deadline for arrangements for which the event triggering the reporting obligation lies between 1 July 2020 and 31 December 2020?

2021/06/17

30.01.2021.

When is the reporting deadline for arrangements for which the event triggering the reporting obligation lies after 1 January 2021?

2021/06/17

30 days in line with Directive.

Penalties

In which cases are penalties imposed?

2021/06/17

Fail in reporting or reporting after the deadline; Report with oversights and inaccuracies; a failure in providing additional clarifications/elements.

What are the penalties?

2021/06/17

Penalties between EUR 2,000 and EUR 160,000, in the following terms:i) Non-submission or submission non-compliant with the deadlines - from € 6,000 to € 40,000 (individuals) or from € 12,000 to € 160,000 (legal persons)ii) Errors or omissions on the information reported - from € 2,000 to 30,000 (individuals) or from € 4,000 to 120,000 (legal persons)iii) Non-submission or submission non-compliant with the deadlines of additional information/clarifications requested by Portuguese Tax Authorities following the submission of the form - from € 3,000 to 40,000 (individuals) or from € 6,000 to 160,000 (legal persons).

Is a distinction made between penalties imposed on intermediaries/relevant taxpayers/other persons obliged to report?

2021/06/17

No distinction is made so far.

What are the penalties in case of redundant reports? A redundant report is a report, which was filed, although there is no obligation to file one.

2021/06/17

None.

Do the penalties differ with regard to incomplete, incorrect, missing or late reports? Are there any gradations?

2021/06/17

Yes, in terms of penalty ranges. Check the "what are the penalties" question.

Are arrangements the first step of which was implemented between 25 June 2018 and 30 June 2020 treated differently in the means of penalties?

2021/06/17

The penalties are reduced to 1/5.

Other aspects

Do already other reporting regimes on cross-border arrangements exist?

2021/06/17

There was a previous regime, that will be revoked once the new enters into force.

Are there any other special deviations from the Directive? 

2021/06/17

There are no other deviations from the Directive than those already mentioned.

What is the name of the national Tax Authority responsible for DAC6?

2021/06/17

Autoridade Tributária e Aduaneira (AT).

Do any other obligations apart from reporting a reportable cross-border arrangement exist under the national DAC6 legislation? (i.e. indication of the arrangement in the tax return)

2021/06/17

There are no other obligations.

Professional privilege/secrecy

Who is primarily obliged to report? Is there a primary reporting obligation of the intermediary or the relevant taxpayer? Is there legal privilege and in how far has it been considered for allocating the reporting obligation?

2021/06/17

Intermediary. Unless a legal / contractual privilege is in place. In that case, within 5 days of providing the tax arrangement the intermediary informs the tax payer he must report within 30 days and confirm accordingly. If no confirmation is obtained with 10 days after the deadline is met, the Intermediary must report.

Does the reporting obligation breach a legal professional privilege under national law?

2021/06/17

Yes. The mandatory obligation lies on the taxpayer. The intermediary is subsidiarily responsible for reporting, in case the taxpayer does not report.

Does the national law make reference to professional privilege or professional secrecy?

2021/06/17

There is no reference.

What is the difference, as per the national law, between professional privilege and professional secrecy?

2021/06/17

There is no guidance.

To which categories of intermediaries does the professional privilege or professional secrecy apply?

2021/06/17

There are no intermediaries who benefit from professional privilege or professional secrecy.

In the context of the reporting obligation, under which conditions are the intermediaries entitled/obliged to make use of professional privilege or professional secrecy?

2021/06/17

There is no specific guidance.

In cases in which professional privilege or secrecy applies, please describe the procedure for notification.

2021/06/17

See the procedure described in question 24.

Does the national law provide specific conditions to waive professional privilege or professional secrecy?

2021/06/17

No.

Henrique Barbosa
Tax Manager