This month, we highlight the binding information of the Portuguese Tax Authorities (PTA), regarding the location of operations in respect of the provision of services to customers located outside Portugal.
The applicant of this Binding Information performs the activity of Youtuber, which consists in the preparation of videos placed on the Youtube site, to which advertising is added, and based on the number of views, time viewed and, depending on the country where it is viewed, the payment is that Youtube finds. Services are provided to customers located in Ireland and Norway.
In the opinion of PTA, the provision of services carried out by the applicant to companies – and which consist of advertising services – does not fall under any of the specific rules in para. 7 to 12 of article 6 of the VAT Code.
As the applicant's customers are subject to VAT pursuant to paragraph 6 a) of article 6 of the VAT Code, the services are considered to be located and, therefore, taxed at the place of the registered office, permanent establishment or, failing that, the domicile of the purchaser of these services, respectively, in Ireland and Norway.
Regardless of whether the service provision is not taxed in Portugal, there is an obligation on the provider to issue invoices, indicating the following reason for non-assessment of the tax:
“VAT – reverse charge” [general rule – article 6, Para. 6 of the VAT Code]"
A detailed description of the service or good must also be made on the invoice, for example, “video production”.
The full content of the Binding Information can be found at: