On November 3 Decree-Law nr. 67/2016 was published, approving the Special Program for Reducing Government debt (Portuguese acronym PERES), which allows extraordinary settlement of debts to the Tax and Customs Authority and/or to the Social Security institute that have not been paid within their regular time limit – until May 31, 2016 for tax debts and until December 31, 2015 for Social Security debts.
According to the legislation approved by the Cabinet and announced by the government, taxpayers (individual and corporate) who are in default may pay the amount they owe in full until the 20th of December, thus benefiting from a complete pardon of interest owed and court costs, or they can agree to an installment payment plan with a maximum duration of 11 years (150 installments) with interest and without requiring pledging of a guarantee.
Those who wish to partake in this extraordinary settlement of debts to the Taxation Authority (tax debts) or to the Social Security Institute (social security debts) must do so electronically on the respective online portals up until 20 December 2016.
This new framework for extraordinary settlement has a new characteristic, namely that it is directed at taxpayers who wish to settle their situation even though they lack the financial capacity to pay their debts all at once. The government’s goal by doing this is to create a situation whereby companies who owe money to the state can still remain economically viable, while also helping families whose available income does not allow them to pay off accumulated debt.
NEWCO is at your disposal to answer any questions you may have regarding this program.