GTL/RTIR – Cash payments ban

08 / 22 / 2017

Law no. 92/2017, of 22 August was officially published, which adds Article 63 (E) to the General Tax Law (“GTL”) and amends Article 129 of the General Tax Infringements Regime ("RTIR"), banning payment or cash receipt in transactions of any nature amounting to or higher than € 3 000, or its equivalent in foreign currency. Such threshold is increased to € 10 000 in the case of natural persons not resident in Portugal insofar not acting as entrepreneurs or traders. Payment of taxes in cash is also limited to € 500.

For the purposes of calculating the limits of € 3 000 and € 10 000, all payments associated with the sale of goods or provision of services are considered on an aggregate basis, even if not exceeding said amounts individually considered.

Individuals paying or receiving cash amounts exceeding said limits are subject with tax penalties ranging from € 180 to € 4 500.

These amendments shall not apply to transactions with financial entities whose legal object includes the receipt of deposits, the provision of payment services, the issuance of electronic money or the performance of manual exchange transactions, payments arising from decisions or judicial orders and other legally specified situations.

The ban enters into force on August 23, with effects to payments made after this date, even if related to previous transactions.