PORTUGAL Law and Practice Contributed by: Tânia de Almeida Ferreira, João Pedro Albuquerque, Filipe Gomes da Silva and Pedro Neves, CCA Law Firm
6.2 Criminal Penalties Under Portuguese law, tax crimes may be punishable by imprisonment or by criminal fine. Criminal fines are calculated on the basis of “day-fine” system, where the court determines a number of day units and assigns a monetary amount to each day. For individu - als, the daily amount ranges from EUR1 to EUR500; for legal entities, it ranges from EUR5 to EUR5,000. Tax fraud is punishable by imprisonment of up to three years or up to 360 day-fines, while aggravated tax fraud is punishable, for individuals, by imprisonment for from one to five years and, for legal entities, by a fine ranging from 240 to 1,200 day-fines, increas - ing to two to eight years’ imprisonment for individuals and 480 to 1,920 day-fines for legal entities where the undue advantage exceeds EUR200,000. Failure to pay over tax withheld or collected is punish - able by imprisonment of up to three years or a penalty of up to 360 day-fines, increasing to one to five years’ imprisonment for individuals and penalties of between 240 and 1,200 day-fines for legal entities where the amount exceeds EUR50,000. 6.3 Interaction Between Tax and Criminal Procedures Most tax offences and criminal cases in Portugal origi - nate within the scope of a tax audit conducted by the PTA, during which the PTA assesses not only the cor - rectness of the taxpayer’s position but also whether the facts identified may constitute an administrative offence or a tax crime. The inspection report usually addresses both aspects, setting out any additional tax and interest assessed and indicating whether the same facts may trigger administrative or criminal liability. Consequently, tax assessments and infringement proceedings frequently commence in parallel. Where the matter qualifies as an administrative offence, the PTA initiates the relevant procedure. If there are indications of a tax crime, the case must be referred to the Public Prosecutor. Although adminis - trative and criminal proceedings may arise from the same facts, criminal proceedings take precedence.
Once a formal indictment is issued, the administrative offence case is dismissed. Tax disputes, administrative offence proceedings and criminal proceedings may run concurrently, as they are legally autonomous. However, if the offence depends on whether the tax assessment is upheld, the infringement proceedings are suspended until the tax dispute is finally resolved. Administrative offence proceedings begin with an investigation conducted by the PTA, followed by a statement of charges, where appropriate. The tax - payer may present a defence before a final decision is issued. Decisions imposing fines may be challenged before administrative and tax courts, with the possibil - ity of further appeal. Criminal proceedings are governed by the general provisions of criminal procedure. The Public Prosecu - tor leads the investigation and determines whether to bring charges. If the case proceeds to trial, the crimi - nal court rules on liability and sanctions, subject to appeal. In summary, the PTA is responsible for audits, assess - ments and administrative offences proceedings, while the Public Prosecutor and criminal courts handle tax crimes. Administrative and tax courts review assess - ments and fines. Although tax and criminal functions are institutionally separate, the system allows coordi - nated parallel proceedings where based on the same facts. 7. Administrative Co-Operation 7.1 Legal Framework for Administrative Co- Operation Multilateral Instruments Portugal’s framework for administrative co-operation in tax matters is grounded in both multilateral and EU instruments. At global level, Portugal is a party to the OECD/Council of Europe Multilateral Convention on Mutual Administrative Assistance in Tax Matters, as amended by the 2010 Protocol.
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