Some of the main measures adopted by Portugal for companies and families following the COVID 19 pandemic are:
Support measures for job protection
These measures can be applied to companies in a situation of demonstrated business crisis due to the total or partial closing of the company or an abrupt and sharp drop in turnover.
Support for the maintenance of employment contracts, in case of temporary reduction of the normal working period or suspension of the employment contract. In the case of lay-off the employee will receive a retributive compensation in the amount equal to 2/3 of the employee’s gross remuneration. 70% of the compensation is provided by Social Security and 30% by the employer;
Support for the implementation of a training plan to be attributed to each employee, paid by the Professional Training Institute (IEFP) and variable, up to a limit of 50% of gross remuneration, depending on the number of training hours attended by employees;
Support equivalent to 1 x RMMG (€ 635), for employers who have benefited from one of the above measures (i.e., simplified lay-off or extraordinary training support), granted by IEFP.
Employers who benefit from the measures listed above are exempt from paying social security contributions in the part referring to the employer (23.75%), with employees’ contributions (11%) continuing to be due.
Facilitation of Tax and Social Security payments
At due date, personal and income withholding taxes and VAT and social security can be paid as follows:
Under the general terms (one single installment);
Withholding taxes and VAT can be paid in three or six monthly installments without interest;
Social security installments that are the responsibility of the employer is split into three parts, being 1/3 paid in the month it is due and the remaining 2/3 paid in three or six interest-free installments.
Access to credit lines
Around €4.5 million were made available for Covid-19 credit lines to support economic activity, which are intended only to finance needs of treasury. The available amount was divided between micro and medium companies being applied more favorable terms and rates. This support was given to tourist activity companies and catering companies. To access to this credit lines companies must justify (in addition to other conditions) that they were not considered to be in difficulties at the date of 31/12/2019 and that they are subject to the lay-off regime, upon presentation of Social Security approval. They must also assume the commitment to maintain jobs until 31/12/2020.
Exceptional measures have been taken for the protection of family credits:
All credit operations granted by credit institutions to Portuguese individuals for own housing are covered, considering that they met one of the following conditions:
The exceptional support measures are (the diploma that approved these measures is effective until September 30):
Manuela Costa, Senior Tax Manager Auren Portugal