A recent survey revealed that most Portuguese continue to use cash in daily transactions, even wishing specific legislation that ensures the acceptance of this means of payment. However, there are legal restrictions on the amounts that can be paid in cash.
What are the legal limits on cash payments?
According to the Banco de Portugal (BDP), restrictions on cash payments are defined in the General Tax Law (LGT), namely article 63-E, amended by Law No. 92/2017, of 22 August.
Payment or reception of cash in transactions equal to or greater than 3,000 euros is prohibited, or equivalent amount in foreign currency.
In the specific case of unique persons not resident in Portugal and who do not act as entrepreneurs or traders, the limit rises to 10,000 euros.
For IRC passive subjects and IRS taxables with organized accounting, payments equal to or greater than 1,000 euros must be performed through methods that allow the recipient to be identified.
In addition, tax payment is also prohibited from amounts to more than 500 euros.
Exceptions to the Law
However, Banco de Portugal stresses that these restrictions do not cover financial entities that perform deposits, provide payment services, issue electronic currency or perform manual exchange operations.
We recommend:
Similarly, the payments made following court orders or situations specifically provided for in special laws are also excluded from these limits.
Additionally, the new wording of article 40 of the LGT (Law No. 82/2023 of 29 December) determines that legal persons can only settle tax benefits through electronic means.
Consequences of Failure
According to the Food and Economic Security Authority (), non -compliance with legal limits on cash payment constitutes a especially serious offense.
The infringement is typified in article 10 and in Article 169 (a) of Law No. 83/2017.
Banco de Portugal also points out that, for additional or more detailed clarifications, citizens should always directly consult applicable legislation or seek information from the competent entities.
Also read:
