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Farewell 2015! Hello 2016

In Portugal the last few months have been a rush… In a short-summary we had:

►► Regular elections for the Portuguese Parliament and Government in October.
►► Refusal of the Government’s Program by the Parliament and as a consequent the dismissal of the Government in November.
►► Appointment of a new Government still in November.

This has put the country somehow on hold and, for instances, it will not be possible to have 2016 State Budget in force in January 1st, 2016. This means that tax measures to be implemented (or not) in 2016 are not known yet.

Notwithstanding, some situations are being published and made available to the general public:

►► Public employees will continue to receive the amounts related to Vacations and Christmas payments in separated instalments. Employees in the Private sector can opt for this payment method or to receive in one-off amounts.
►► Possible increase of the minimum monthly wage from EUR 505 to EUR 530 (aiming at a final position in 2019 of EUR 600).
►► It is yet to be seen if in 2016 the general Corporate Income Tax (CIT) rate is reduced from 21% to 19%, as it was initially foreseen in law proposal of the CIT reform occurred in 2014.
►► Unless otherwise is stated in 2016 the limitation on the net interest expense for CIT purposes corresponds to the higher amount between 40% of EBITDA or EUR 1,000,000.

Several other situations could be mentioned, but these would also be pending for closure.

From a local accounting perspective, considering the yearend season, it is important to consider any potential impact of any existing deferred taxation (either asset or liability). For the moment the only approved rate is 21%, which should be the one to consider.

2017-09-18T16:04:19+00:00 16/02/2016|Latest news|