If you’ve recently moved to Portugal and are not sure why you keep getting asked for your NIF, this article is for you! The first step in becoming a resident in Portugal is getting a NIF, or Número de Identificação Fiscal. This is Portugal’s taxpayer identification number, and it is used for legal and tax purposes throughout your life in Portugal.

Unlike some countries who only request tax identification numbers for identification purposes when filing a tax return or completing official documentation, Portugal also uses the NIF to track your purchases from everything to groceries and home repair services to public transportation and gym memberships. By giving your NIF for various purchases around Portugal, you will be able to take deductions on your Portuguese Tax Return. Unlike the US Tax system, which requires you to track receipts yourself and declare expenses, declaring your NIF can take care of this for you.

E-Fatura

Giving your NIF for every purchase can seem tedious, but it actually saves you time and money in the long run because the E-Fatura system tracks each NIF purchase for you and calculates the appropriate tax deductions. To check your total deductions, you can log on to the E-Fatura system, which uses the same log in as the Finanças website.   This is also where you can input receipts that were not added automatically by companies that issued you a receipt. Keep in mind that it takes around two months for receipts from companies to be updated in the E-Fatura website.

When you log-on to the website, click the first tab on the left called “Faturação.” You will then see a drop-down list and click “Adquirente” here. You will then be prompted to insert your NIF number and the same password that you use to access the Finanças website. Once you are logged in, you can see all the different categories of expenses on the main dashboard.

Tax Deductible Expenses and Their Limits Using the NIF

As you can see on the E-Fatura dashboard, there are several different categories of expenses:

• General Family Expenses – This includes utilities, gasoline, clothing, supermarket, and other general expenses. You can take 35% of these expenses up to a maximum deductible of €250 per taxpayer. For single-parent families, the percentage increases to 45% or a maximum deduction of €335.
• Health Expenses – This includes medication, prostheses, treatments, eyeglasses, health insurance, orthodontic braces, hospital stays, surgical operations, and medical appointments. You can take 15% of these expenses up to a maximum deductible of €1,000 per taxpayer.
• Education Expenses – This includes fees with college university/tuition, kindergartens, schools, daycare centers, tutoring, meals, transportation, textbooks, schoolbooks, and rent for displaced students. You can take 30% of these expenses up to a maximum deductible of €800 per taxpayer. The general limit of €800 can be increased to €1,000 if there are extra rent expenses for displaced students. The maximum deduction for student rent is €300. For families with students enrolled in schools in the interior part of Portugal, deductions can be increased to up to 40% with a limit of €1,000.
• Housing Costs – This includes housing costs up to a maximum of €502 or you can take 15% of home loan interest expenses for contracts before December 31, 2011, up to a maximum deduction of €296.
• VAT – You can take 15% up to a maximum of €250 per tax payer on expenses related to hairdressers/salons, car and motorcycle repairs, veterinary costs, sports club and gym activities, and restaurants and hotels.
• Alimony Payments – You can take 20% of all alimony payments without limit
• Senior Nursing Homes – You can take 25% of expenses up to a maximum deductible amount of €403.75 related to senior home support and institutions that support the elderly.
• Public Transportation – 100% of VAT paid on public transportation is deductible up to a limit of €250.

Final Thoughts

The E-Fatura is a convenient place to check your receipts and ensure that invoices that companies have issued with your NIF are making it into the system. The next time someone asks you if you want a receipt, you now know where you can go to input it or double check it. An E-Fature app is also available for Apple or Android users. Finally, at the bottom of this page, you can click “Obter Cartão E-Fatura” and download a PDF with your NIF number autopopulated to make it easier to register your NIF number. We hope this helps you use your NIF more effectively during your everyday life in Portugal.