IVAucher: Find out what it is and how it works

The IVAucher program, which started on June 1, allows you to accumulate VAT paid in restaurants, accommodation and culture, and use that money on future purchases in the same sectors.

With tourism, restaurants and culture suffering the effects of the pandemic, the government has prepared a package of measures to help and stimulate consumption in these sectors, among which is the IVAucher.

Through this mechanism, it’s possible to accumulate, during the months of June, July, and August, the VAT paid on accommodation, restaurant, and cultural expenses, and then exchange it for discounts on subsequent consumption. In September there will be no accumulation of values and the balance can then be discounted in October, November, and December.

However, it should be noted that the accumulated VAT cannot be used to pay for more than 50% of a new purchase.

Table of contents

What is the IVAucher?
What expenses can I accumulate VAT on
Which CAE are covered
What is the value of the discount
How do I join the IVAucher
What is the IVAucher App
What is the IVAucher Seal
Can the discounted VAT be deducted in the IRS

What is the IVAucher?

The IVAucher is included in the proposal for the Portuguese 2021 State Budget. It’s a temporary mechanism that will allow the Portuguese to accumulate the value of VAT paid on certain expenses and then discount this amount on future purchases.

The goal is to stimulate the economy, favoring the sectors most affected by the pandemic: hospitality, restaurants and culture. And the first day of June marked the start of the first phase of IVAucher. And there are several steps to follow and rules to follow.

What expenses can I accumulate VAT on?

This support program is aimed exclusively at the hospitality, culture and restaurant sectors.

Therefore, only VAT from invoices issued in these sectors can be accumulated. This VAT can also only be deducted from expenses made in these same sectors, in the last quarter of the year.

Which CAE are covered?

The main CAE (Economic Activity Code) of the establishments and companies in the sectors covered by IVAucher should be as follows:

55: accommodation, including local accommodation;

56: catering and similar activities, including cafes, bars or pastry shops;

90: theater, music, dance and other artistic and literary activities;

91: libraries, archives, museums and other cultural activities;

47610: bookshops (includes purchase of books, newspapers and magazines);

59: movie theaters.

What is the value of the discount?

The value will be “corresponding to the total VAT” paid on expenses in the sectors in question, for a quarter, according to the text of the proposed State Budget for 2021. The proposal also indicates that the “use of the accumulated value is made by immediate discount on consumption.

If, for example, you paid a restaurant bill for a total of 100 euros, of which 13 euros correspond to VAT (100 euros x 13%), that is the amount that will accumulate and discount in a next expense. In the last quarter of the year, you can cash in those 13 euros for a meal in another restaurant, a concert, or a hotel stay. However, the accumulated VAT cannot be used to pay for more than 50% of a new purchase.

The value of the accumulated VAT, and that which you can then discount, is based on the amounts on the invoices reported to the Tax Authority.

How do I join the IVAucher?

Joining the IVAucher is free and without any cost. In the first phase, between June 1st and August 31st, taxpayers who wish to join the program will only have to request an invoice with a Tax Identification Number (NIF), that is, the credit will be based on the invoices to which the taxpayers associate their NIF.

Although payments can be made in cash or by card, to use the accumulated balance on purchases made in the three sectors in question, you must pay with the cards associated with the account and only at retailers who join the program.

In the second phase, during the month of September, the Tax Authority will determine the final value of the accumulated IVAucher benefit based on the reported invoices.

In the third phase, between October 1st and December 31st, consumers can use the accumulated benefit in any of the three sectors covered. In this phase, retailers either have an automatic payment terminal (APT), for bank cards, or will allow the customer to make the payment by communicating the NIF.

What is the IVAucher App?

The IVAucher App is a technological solution from which taxpayers can join the program.

In the App, taxpayers will have to associate their NIF with one or more payment cards. The actual adhesion can occur at any time if it’s before the end of the year.

What is the IVAucher Seal?

To the commercial establishments that benefit from the program, the Tax and Customs Authority will provide a seal, similar to the Clean and Safe seal for tourism, informing that in that location it’s possible to benefit from the IVAucher program.

The Government has determined that “establishments must identify themselves, visibly and preferably at the entrance, with a seal that identifies that the establishment is eligible to use the IVAucher balance.

Can the discounted VAT be deducted in the IRS?

Currently, 15% of the VAT spent on expenses in the restaurant and accommodation sectors can be deducted from the IRS (art.º 78.º-F of CIRS).

However, the balance of VAT that is used to obtain discounts in hospitality, restaurants and culture, can no longer be deducted from the IRS, when making the tax adjustment in the following year.

Even so, the amount not used in the IVAucher will be automatically channeled to the IRS collection deductions.

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