For expat entrepreneurs starting businesses in Lisbon, understanding and managing Portuguese tax obligations is essential. A key aspect is ensuring that your NIF (Número de Identificação Fiscal) also called your NIPC (Número de Identificação de Pessoa Colectiva) is included in all business purchases. This article highlights the importance of this practice and how it can impact your company’s financial health.
The NIF is a unique tax identification number for individuals and businesses in Portugal. For companies, it is called the NIPC. You’ll also see this referred to as your VAT Number, and you may need to add the letter “PT” before your tax number when dealing with international companies. Including this number on all business-related invoices and receipts is vital for deducting these expenses from your taxable income.
In Portugal, for a business expense to be deductible, the invoice must include your company’s VAT number (NIF or NIPC). Without it, even legitimate business expenses may not be accepted for tax purposes. For example, we’ve seen cases where a commercial lease was signed under an individual’s name instead of the company, and the related expenses couldn’t be deducted until the contract was updated.
Small documentation issues like this can add up over time. Including your VAT number on all relevant invoices is a simple but essential step in maintaining proper tax records.
Elevate Accounting works with expat business owners in Lisbon to support their business accounting needs. Our English-speaking team helps ensure that business expenses are properly documented, including the correct use of your NIF or NIPC on invoices and receipts.
Including your VAT number on business purchases is an important step toward maintaining clear financial records and meeting your tax obligations. If you’d like to learn more about how we can support your business in Portugal, feel free to get in touch.