Covid-19 - Summary of Measures

PORTUGAL

GOVERNMENT MEASURES INTRODUCED FOR COMPANIES AND INDIVIDUALS AS A RESPONSE TO THE
PANDEMIC COVID-19 IN PORTUGAL

1. Flexibility in the payment and reporting requirements of taxes and social security contributions
   1. Corporation Tax –
      • The deadline for making corporation tax payments on account which fall due in the period up to the end of June is extended until the second semester of the year;
      • Corporation Tax Return deadline extended to 31 July (Normally 31 of May);
      • Company Annual Return deadline extended to August (Normally the 15 of July)
   2. Social Security
      • 2/3 of employers’ contributions for social security for March, April and May can be deferred to the second semester of the year. Payment can be made in either 3 or 6 installments;
   3. Withholding Tax on salaries
      • 2/3 of the withholding tax taken from employees is payable in either 3 or 6 installments beginning in the following month from the month it is due;
   4. VAT
      • 2/3 of VAT payable that becomes due from April 2020 onwards is payable in either 3 or 6 installments beginning in the following month from the month it is due;
2. Government support for companies affected by Covid-19
   • The government will provide support to companies/individuals in the following situations
     • Due to the schools and nurseries being closed employees with children under 12 will have 2/3 of their monthly salary supported by the social security with a minimum of € 635 and a maximum of € 1,905. This scheme starts on the 16 of March and continues while the schools and nurseries remain closed;
     • If the company has had to close or has experienced a significant reduction in business (over 40%) or is unable to operate because it cannot receive essential supplies, they are allowed to lay-off their employees. Under this scheme the employee has the right to receive 2/3 of their monthly net salary with a minimum of € 635 and a maximum of € 1,905. In the case the social security pays 70% with the employer paying the rest. This is requested on a monthly basis and will last to up to 3 months;
     • Self-employed contractors whose businesses have had to close or have experienced a significant reduction in business can receive from the social security a subsidy of between € 438.81 and € 1,097.03 per month. The amount to receive is dependent on remuneration declared to the social security previously and is only open to contractors who have made contributions for social security for at least 3 consecutive months in the last 12 months;
     • Owners of small companies with no employees which invoiced less than € 60,000 in the previous calendar year who have had to close or have had a significant reduction of in business can receive a monthly subsidy of between € 438.81 and € 635;
     • Employees and contractors who are having to self-isolate or are actually ill with Covid-19 will receive sick pay paid by the social security of up to 100% of their salary or average remuneration if they are a contractor. This also includes employees and contractors who are unable to work because they must take care of a dependent child who is obliged to self-isolate or has Covid-19 ;
3. Other Measures
   • • Annual general meetings to approve company accounts can be delayed until the end of June instead of the usual deadline of 31 March;
     • Car Inspections which fall due between the March and end of June can be done in July;
     • Tax coercive collection procedures are suspended until the end of June 2020.
     • Loans can be obtained by tenants renting their homes whose income is affected substantially by the pandemic crisis;
     • Landlords renting to businesses which have been forced to close or have had a significant reduction in business can receive loans for rent not received;
     • The government through the banks will guarantee loans to businesses affected by Covid-19 at a specially reduced interest rate.

03/05/2020

If you have any questions regarding this or any of the other initiatives offered to those affected by the current disruption, please contact Andrew Kennard akennard@hkconsulting.pt.