Banking Secrecy

Portuguese tax law states that all companies must have at least one bank account used exclusively for their business activity. This is to avoid the old habit of sole traders mixing up their personal and company money, usually with the result that all personal expenses are paid with company funds.

How can that be enforced? It's difficult. The latest underhand trick is that if you want to present any alteration to a company's tax status, it is now obligatory to fill in the "bank account for tax refund" section of the form. I have a problem with that. For the tax man to find out the number of a company's bank account, he has otherwise to ask a judge. Armed with that number, provided voluntarily by the tax payer, snooping is much easier. And let's dispel the myth that there is banking secrecy without a warrant.

What do I base this conspiracy theory on?

The tax office is now emailing tax payers, both companies and individuals, pressuring them to register the number of their bank account in order to receive any tax refunds that may be due. My email states that my bank account details are "unconfirmed", when I have been receiving my refunds for ten years, always by transfer to the same account. I know of a company that has a VAT exempt status, where the email states "unless you register your bank account, you will be unable to receive your VAT refunds".

Who are they trying to kid?

The tax authorities have been given excessive powers and insufficient resources to correct any mistakes made, which are frequent. This is just another example, so if you are an individual and receive the email, my advice is to forget it. If they don't have your bank details, they will send you a cheque.