Mandatory B2G E-Invoicing in Portugal: Streamlining Transactions with the Public Sector

For several years, the Portuguese government has been working towards making electronic invoicing mandatory for B2G (Business-to-Government) transactions. 

Due to Directive 2014/55/EU issued by the EU, member states are obligated to mandate public administration to receive electronic invoices. However, some EU member states have chosen to extend this requirement to include suppliers to the public sector, necessitating them to issue electronic invoices when dealing with the government. 

The Portuguese mandate, known as “Electronic Invoicing to the Public Administration” (Fatura Eletrónica à Administração Pública – FEAP), was introduced to streamline invoicing processes and enhance efficiency in transactions between businesses and the public sector. 

In Portugal, businesses supplying goods or services to the public sector must submit their invoices electronically. 

Exceptions to E-Invoicing for the Public Sector 

There are exceptions where, in certain situations, sending invoices to the public electronically is not required. Exceptions apply to: 

• Secret contracts or contracts requiring special security measures. 
• Contracts with a value less than EUR 5,000. 

The Process of Implementing Mandatory B2G E-Invoicing in Portugal 

Regarding implementing new VAT and invoicing processes, delays and date changes are common, as seen in other European countries. Various factors contribute to these changes, including the time it takes to decide on new requirements and the need for businesses to adjust and implement the new processes. Consequently, requirements are often implemented in different phases. 

This complexity makes it challenging to stay updated on requirements and changes in different European countries. Portugal is no exception, and the implementation has occurred gradually. The first phase of the project involved the public administration in Portugal beginning to receive electronic invoices in April 2019. 

When Must Businesses Comply with B2G E-Invoicing in Portugal? 

Compliance with issuing electronic invoices to the public sector is becoming gradually mandatory, starting with large enterprises in January 2021. The implementation schedule has been postponed multiple times, and currently, only large enterprises are obligated to issue electronic invoices. 

Currently, all public entities are required to receive e-invoices in the structured CIUS-PT format. Additionally, all major enterprises supplying the public sector must issue e-invoices in this format. 

The deadline for SMEs has been postponed several times, but as of now, the deadline is December 31, 2023, when the regulation will be published, providing more information on deadlines. 

What Does This Mean for You? 

Adhering to the requirements for electronic invoicing is crucial, as sending invoices to the public in Portugal would otherwise be impossible or illegal. These requirements apply to companies with operations in Portugal that sell goods or services to the public. 

Watch the recording of our webinar to gain firsthand insight and practical tips for maintaining accurate and seamless tax compliance in Europe.