SAF-T in Portugal
In 2008, Portugal became the first country to adopt the SAF-T file, which companies use to submit accounting and invoicing information to the Portuguese tax authorities.
What is SAF-T?
SAF-T is an XML file based on a standard international pattern developed by the OECD. It enables accounting and invoicing data to be submitted electronically to the tax authorities of a given country. The name SAF-T is the abbreviation for Standard Audit File – Tax purposes and it designates the file that contains all of a company’s tax-relevant information relating to a given period of time. This system was created with the aim of facilitating the collection of relevant tax data in electronic format by tax inspectors and auditors, as a support for taxpayers’ tax returns and the analysis of accounts and other types of tax-relevant records. Consequently, it is an important tool in the fight against tax evasion.
In practice, the SAF-T file collates all of the data contained in a company’s invoicing and accounting system, including: the identification of the company, its customers and suppliers, the identification of the products sold and services rendered by the company, the invoices and receipts issued, transportation documents, restaurant bills and more.
Types of SAF-T files
There are actually two types of SAF-T files: SAF-T invoicing and SAF-T accounting.
SAF-T invoicing is a simplified file that extracts a company’s invoicing data from certified invoicing programmes. The use of such programmes is mandatory for companies which have their head office or a stable establishment in Portugal. This file must be submitted to the tax authorities every month. Starting on 1 January 2020, it must be submitted no later than the 12th of the month following that to which it relates. The invoicing programmes automatically create the file with the relevant documents and it can then be exported and sent automatically or manually input on the e-fatura portal no later than the deadline set by law (see what’s new in 2020).
Another type of file is the SAF-T accounting, which works along the same lines as the SAF-T invoicing but collects all of a company’s accounting records for a specific financial year. This includes information about suppliers, customers, partners and other debtors and creditors.
Until recently, this SAF-T file was mandatory but was only exported and sent to the tax authorities when they requested it (as part of an inspection, for example). However, starting from the 2020 financial year, the SAF-T accounting file has become mandatory for use in the automatic pre-filling-in of the IES, the electronic statement submitted annually for the fulfilment of accounting, tax and statistical obligations of companies in Portugal.
The “Simplified Business Information” (Informação Empresarial Simplificada or “IES” in Portuguese) is an electronic statement. Using a single means and a single form, companies can submit various data about their annual accounts (deposit of accounts, accounting and tax statements and annual accounting data) that previously had to be submitted using different means and to different entities: The Tax Authority, Statistics Portugal and Banco de Portugal. The creation of the IES in 2007 considerably simplified Portuguese companies’ contributory obligations, helping to cut costs and foster a more competitive and transparent economy.
As mentioned above, the big news in 2019 was the introduction of the interconnection between the SAF-T accounting file and the filling in of the IES, with the SAF-T accounting file having to be exported no later than 30 April of the year following the financial year in question, so that Annexes A and I of the IES would be automatically filled in in advance. This will be applicable from 2021 onwards, relating to the 2020 financial year.
Who is required to submit a SAF-T file?
Those who have to submit a SAF-T file are all taxpayers who pay IRC (corporate income tax) or who pay IRS (personal income tax) with organised accounting, and those who are required to submit any of the component annexes of the IES.
Where is the SAF-T file validated?
A certified accountant must export the SAF-T file and submit it on the Tax Authority’s portal within the time frame stipulated by law.
How is the SAF-T file sent and validated?
The SAF-T invoicing file must be exported and input (manually or, if the certified invoicing programme allows, automatically) no later than the 10th of the month following that to which it relates. This must be done by a certified accountant.
From 2021 (so, relating to the 2020 financial year), the submission deadlines for SAF-T accounting files will be as follows:
- No later than 30 April of the year following that to which the accounting data relates in the case of personal income taxpayers (IRS) with organised accounts and corporate income taxpayers (IRC) required to have their accounts for the financial year approved by 31 March;
- No later than 15 June of the year following that to which the accounting data relates in the case of corporate income taxpayers (IRC) required to have their accounts for the financial year approved by 31 May;
- No later than the end of the fourth month after the end date of the tax period, in the case of corporate income taxpayers (IRC) whose tax period does not coincide with the calendar year;
- In the case of companies which are ceasing trading, no later than the 60th day before that which constitutes the deadline for submission of the statement relating to the termination period; said time frame will also apply in respect of the submission of the file relating to the tax period immediately prior.
When the certified accountant uploads the SAF-T accounting file to the Tax Authority’s portal, the relevant annexes on the IES will be filled in automatically and the ATM references will be automatically generated for the payment of registration of the rendering of accounts.
Consequences of the new SAF-T accounting rules
Once a company’s SAF-T accounting file has been submitted, all of its accounting records will automatically available to the Tax Authority, which will even have access to the date and time of the company’s successive accounting records. This transparency places even more responsibility on the companies and on those in charge of their accounts and could result in large fines if the accounts are not updated within the deadlines stipulated by law. Indeed, delays of more than 90 days in the accounting records are punishable by fines of as much as €5,000. Consequently, it is essential that all accounting information is provided regularly to ensure that those responsible for the company’s accounting records are able to process and submit them in timely fashion.
NEWCO has a team of certified accountants with over 30 years’ experience in providing accounting services and ensuring the fulfilment of tax obligations for companies of different sizes and operating in a wide range of business sectors.