VAT rates in Portugal
Portugal has three VAT rates — standard, intermediate and reduced — and the figures change by region. On the mainland they're 23%, 13% and 6%. In Madeira they're 22%, 12% and 4% (the reduced rate dropped from 5% to 4% in October 2024), and in the Azores 16%, 9% and 4%. This calculator applies the correct rate for whichever region you choose.
Adding or removing VAT
"Add" starts from an amount without VAT and adds the tax — useful for issuing invoices. "Remove" starts from an amount that already includes VAT and shows the base and the tax — useful for figuring out how much of an invoice is tax.
VAT for TVDE drivers
Anyone driving for Uber, Bolt or Free Now has VAT rules of their own, different from most service providers. It's worth understanding both regimes before choosing — the difference can be significant by year's end.
Exemption or standard regime — which to choose?
If you bill under €14,500 a year, you can stay in the exemption regime (article 53): you don't charge VAT on invoices and don't file periodic returns, but you also can't reclaim VAT you pay on fuel, insurance or maintenance. Above that threshold — or if you opt in — you enter the standard regime: you charge 6% VAT on trips (not the 23% many people assume) and can deduct part of the VAT on car expenses. Registration and returns are always done through the Portal das Finanças.
Why 6% and not 23%?
Passenger transport falls under List I attached to the VAT Code (item 2.14), which applies the reduced rate. Drivers are often confused by this because most services provided by self-employed workers use 23% — passenger transport is a specific exception.
Can I reclaim VAT on fuel?
It depends on the fuel. Diesel is 50% deductible, petrol is not deductible, and electricity for charging an EV is 100% deductible — one more reason many TVDE drivers consider switching to electric. Maintenance and repairs are usually 100% deductible, provided the vehicle is used exclusively for the activity.
Frequently asked questions
Which rate should I use?
Most goods and services use the standard rate (23% on the mainland). Some food and services have reduced rates. When in doubt, check your CAE code or ask an accountant.
How do I calculate VAT on an amount?
To add VAT, multiply the amount without VAT by the rate factor (e.g. ×1.23 for 23%) to get the amount with VAT. To remove VAT from an amount that already includes it, divide by the same factor (÷1.23) to reach the amount without VAT. The calculator above does both automatically.
What does "VAT included" mean?
It means the price shown already contains the tax — it's the final amount payable. The "amount without VAT" is the base before tax is added. Use "Remove VAT" mode above to see both figures starting from a VAT-included price.
Is it free?
Yes — free, no signup, nothing is stored.