Payments and Foreign Receipts

Withholdings at Source – Payment Guides
17 February, 2022
Permanent Inventory
17 February, 2022


Payments and receipts from abroad relating to the Provision of Services are increasingly under the control of tax authorities (and central banks) of all countries in the world. The question that is developed here only addresses the Provision of Services, not the exchange of goods, as these have their own controls at customs and Intrastat levels.

This control is increasingly tight, only because of concerns of the nature of each State, ensuring the expansion of tax bases, but also due to anti-abuse and capital control measures.

The Portuguese State promoted the control of the entities’ gains in the international market.

For better information, on the duration of the forms and conventions, we suggest consulting:

In this context, the exchange of services on the market, the corresponding currency flows and, above all, attention to the tax impact of the profits of the companies involved, require an update to Circular 03/2012.

Thus, and before initiating a commercial relationship with a foreign entity, whether from the Union or from the Third Country, the Portuguese must ensure compliance with the following procedures:


The foreign service provider must submit to the Portuguese customer a 21RFI – REQUEST FOR TOTAL OR PARTIAL WITHDRAWAL WITHHOLDING AT THE SOURCE OF THE PORTUGUESE TAX, triggering the Convention. It is suggested that the Portuguese developer/payer implement a procedure that ensures that this form is sent to its foreign supplier so that the employee can validate it with the authorities of his country and return it.

The 21RF is valid for one, so the Portuguese debtor must ensure that the form in hand is up to date, if he makes his payment when different, he is obliged to execute the source of the Portuguese tax to the competent authority. The rate in force (if updated, the obligation to pay the amount is not always with the payer).

It is worth noting that there are 8 countries that, despite having been signed with the CDT state, do not recognize the European 21RFI, having a specific form for the Portuguese purpose. They are Brazil, Chile, Hong Kong, Morocco, Mexico, Panama, Pakistan and Turkey.

The Portuguese debtor requests to the Tax Authority (AT), on the Finance Portal, a special taxpayer number for a foreign supplier, which always remains the same and which will be included in the declaration model 30, to be submitted by Accounting until the end of the following month (provided that all necessary information is available).

21RFI is applicable in cases where the CDT is not known to Portugal (for example, Angola, so there is always room for a non-source when simulated to the foreign supplier). In this case, either by providing your foreign supplier with proof of delivery or by providing the withheld tax. This tax will be considered in the beneficiary’s annual income statement for the period to which it relates.


Portuguese liabilities that provide services to foreign customers must present the model 2RFI – CERTIFICATE OF FISCAL RESIDENCE, thus triggering the Convention.

The foreign customer must not make any attempt or at source when making a payment. If so, the Portuguese taxable person requests the refund of the tax withheld in the payer’s country, using a specific form, in force in each country.

If the national taxable person has a permanent establishment in the payer’s country, he can make one at the source at the time of payment. In this case, you will obtain a nature of a tax on the account and deducted when the establishment is stable with its annual income declaration in place.

It is not applicable when not the CDT2 that is, probably, nor is the place other than the source in the receipt of customers. In this case, the customer has made available the tax withheld on the case and gross national amount, which will be considered in the IRC declaration for the period to which it relates.


The administrative services of the interested entities must maintain control of existence and not comply with procedures, especially the existence of validity. Failure to comply with the procedures has several tax obligations.

Finally, it is important that the existence of a 21RFI and/or a 2RFI is obviously in the interests of the parties, not least because an entity can be present in the international market simultaneously as a supplier and a customer:

1. Do what is right if the customer is obliged to carry out the obligation, that is, the same to pay, if it is not up to date.

2. From the supplier, who is thus taxed exclusively in his country.

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