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types of accounting in Portugal

In Portugal, there are different types of accounting that meet the different needs of companies and professionals. From management accounting, focused on budget analysis and data reporting, to tax accounting, which offers tax advice and planning, each type plays a crucial role in the financial health and compliance of organizations. This article explores the main types of accounting practiced in Portugal, their characteristics and advantages.

Key Points

  • Management accounting is essential for budget analysis, data reporting, costs and statistics.
  • Financial accounting focuses on producing financial statements and analyzing market trends.
  • Tax accounting is crucial for advising companies and complying with tax obligations.
  • Organized accounting is mandatory for most companies and offers rigorous control of assets and financial positioning.
  • The simplified regime is a viable option for sole traders and self-employed workers with gross annual income of less than 200 thousand euros.

Management Accounting

Management accounting provides information to company managers that helps them make informed decisions. This type of accounting monitors and assists in the financial planning of an organization. Their documentation is typically intended for internal stakeholders and not the public. A management accountant must be careful in communicating confidential information and to whom they communicate it.

Budget Analysis

Budget analysis is crucial to ensure that company resources are used efficiently. Allows you to identify areas where costs can be reduced and where investments can be more profitable. This analysis helps the company to stay within established financial limits and plan for the future.

Data Reports

Data reports provide a detailed view of a company's financial performance. These reports include financial forecasts, performance analyzes and other information that helps the company make strategic decisions. The accuracy of the data is essential to ensure that decisions are based on reliable information.

Costs and Statistics

Cost and statistical analysis allows the company to better understand its expenses and how they affect the final price of products or services. This analysis can identify opportunities to reduce costs and improve operational efficiency. It is a valuable tool for maximizing profits and ensuring long-term sustainability.

Management accounting is an essential tool for any company that wants to make informed and strategic decisions. It allows a clear and detailed view of financial operations, helping to identify areas for improvement and growth opportunities.

Financial Accounting

Financial Statements

Financial accounting is essential for creating financial statements, which are mandatory and follow established standards. These statements include the balance sheet, income statement and cash flow. This information is crucial for assessing the financial health of your company and are intended for the State, management bodies, suppliers and, sometimes, customers.

Market tendencies

Financial accounting also helps you identify market trends by analyzing historical financial data. Understanding these trends can be vital to making informed decisions about investments and growth strategies. stay up to date with market trends can give you a competitive advantage.

Company Results

A company's financial results, such as profits and revenue, are managed and analyzed through financial accounting. These results provide a clear view of the company's past performance, allowing you to better plan for the future. Without good financial accounting, your entire cost structure could collapse.

Financial accounting not only guarantees data transparency, but also reinforces trust among the company's stakeholders.

Tax Accounting

Business Advice

In tax accounting, it is essential to have in-depth knowledge of applicable tax laws. This type of accounting helps to choose the most appropriate tax regime for the commercial activity, avoiding incorrect payment of taxes. Good tax advice can make the difference between paying more or less tax.

Tax Compliance

Tax accounting deals with preparing tax returns and calculating taxes owed. The main objective is to ensure that the entity is accurately calculating and reporting its tax obligations. Proper tax preparation can help a company avoid errors in its tax documentation.

Tax Planning

Tax planning is a crucial part of tax accounting. It involves finding ways to avoid unnecessary tax burdens and ensuring that all tax savings opportunities are taken advantage of. Deductible expenses such as fuel, transport and property expenses can be monitored with increased rigor to maximize tax efficiency.

Organized Accounting

Obligatoriness

Organized accounting is mandatory for all companies, such as public limited companies or limited liability companies, and for self-employed professionals or sole traders with a net annual income exceeding 200 thousand euros. This regime is essential for more complex activities, where expenses exceed 25% of income.

Advantages and disadvantages

The main advantage of organized accounting is financial transparency, which allows for better decision-making and avoids management errors or fraud. However, this regime also brings more tax obligations and associated expenses, such as certified accountant fees.

Legal requirements

To be part of organized accounting, it is necessary to hire a certified accountant. This professional will be responsible for all tax bureaucracy, including delivering the declaration of commencement of activity. Organized accounting follows standards defined by regulatory authorities, ensuring compliance with applicable laws and regulations.

Organized accounting is a formal and structured system that ensures companies' financial transparency and compliance.

Simplified Regime

Who Can Choose

The simplified regime applies to self-employed workers, such as self-employed professionals and sole traders, with a gross annual income of up to 200 thousand euros. This regime is assigned by default by the Tax and Customs Authority the moment you open activity.

Advantages and disadvantages

Benefits:

  • Simplicity in tax management
  • Less bureaucracy
  • Ideal for small businesses with low sales volume

Disadvantages:

  • Does not allow deduction of professional expenses
  • May be less advantageous for those with high expenses

Specific Requirements

To be covered by the simplified regime, you must meet the following requirements:

  1. Being self-employed or a sole trader
  2. Have a gross annual income of up to 200 thousand euros
  3. Do not opt for the organized accounting regime, if it is more favorable

The simplified regime is perfect for those looking for an easy and quick solution for the tax management of their business.

Accounting for Micro and Small Businesses

Managing the accounting of micro and small businesses can be a real challenge. Businesspeople often do not understand the importance of accounting and end up associating it only with paying taxes. This limited vision can lead to poor financial management and the waste of valuable resources.

Accounting is not just for meeting tax obligations. It is an essential tool for business management, allowing a clear view of the company's financial health. With good accounting, you can make informed and strategic decisions, ensuring the sustainable growth of your business.

To facilitate accounting management, consider the following practical solutions:

  • Use accounting software suited to your company’s needs.
  • Hire a certified accountant to help you keep your accounts in order.
  • Periodically review your finances to identify possible problems and opportunities.

Well-done accounting is an investment in the future of your company. Don't see it as a cost, but as a growth tool.

External or General Accounting

Company Assets

External or general accounting is the most practiced by companies in Portugal, as it is mandatory. This type of accounting is essentially responsible for the company's assets, taking care of its financial positioning in society, competitors, suppliers and customers. Accountants or official accounts technicians Those responsible for this work develop their activity with the aim of creating effective and transparent control.

Financial Positioning

External accounting involves reviewing a company's formal financial statements, ensuring that they are prepared in accordance with accounting standards. This is crucial for the financial positioning of the company, as it allows a clear and accurate view of its financial health. Furthermore, it helps to identify potential waste of resources and mitigate the risk of fraud.

Relationships with Suppliers and Customers

Maintaining well-organized external accounting is essential for relationships with suppliers and customers. A company with transparent and well-managed accounting conveys trust and credibility, facilitating negotiations and partnerships. Here are some benefits:

  • Improved supplier confidence
  • Ease of negotiations
  • Transparency in transactions

Well-managed external accounting is key to the financial and relational success of any company.

Certification of Accountants in Portugal

Regulatory Entities

In Portugal, the certification of accountants is mainly regulated by the Order of Certified Accountants (OCC). This entity has a long history, dating back to 1759, when the Aula do Comércio was created by the Marquês de Pombal. The OCC is responsible for ensuring that professionals meet the necessary requirements to practice the accounting profession.

Certification Process

To become a certified accountant, you must follow a rigorous process that includes obtaining specific academic qualifications, completing a professional internship and passing a certification exam. This process ensures that accountants have the necessary skills and knowledge to perform their duties effectively.

Importance of Certification

Certification is crucial to guarantee the quality and reliability of the services provided by accountants. Having a certified accountant can make all the difference in a company's financial management, ensuring compliance with tax obligations and informed decision-making. Furthermore, certification offers greater credibility and trust with customers and business partners.

The certification of accountants in Portugal is a demanding process, but essential to ensure the quality and integrity of the profession.

Accounting Training

Higher Education Courses

If you are thinking about pursuing a career in accounting, a higher education course is an excellent option. You can choose a diploma in accounting sciences, administration and business or an advanced degree in accounting. These courses last an average of 6 to 12 months and prepare you for the job market with a solid foundation in accounting principles, financial administration and business communication.

Continuous formation

Continuous training is essential to stay up to date in the world of accounting. There are several options, from workshops to online courses, that allow you to deepen specific knowledge or learn about new tools and accounting software. Continuous training helps you to always be one step ahead and improve your professional skills.

Support from Private Teachers

If you prefer more personalized support, you can consider having a private teacher. This type of support is ideal for clarifying specific doubts, preparing for exams or simply to help you better understand certain topics. A private teacher can make all the difference in your academic and professional career.

Accounting training is an investment in your future, providing you with the tools necessary for a successful career.

Accounting for Independent Workers

Taxation Options

As a self-employed worker, you have two main taxation options: the simplified regime and organized accounting. The choice between these schemes depends on several factors, such as the type of activity you carry out, your annual turnover and deductible expenses. It is crucial to choose the most appropriate regime to optimize your taxes.

Advantages of the Simplified Regime

The simplified regime is ideal for those who have a less complex activity and with fewer deductible expenses. In this regime, taxation is calculated based on coefficients applied to gross income, which greatly simplifies the process. Some of the advantages include:

  • Less administrative complexity
  • It is not necessary to hire a certified accountant
  • Reduction of coefficients in the first years of activity

When to Choose Organized Accounting

Organized accounting is best suited for activities with higher turnover and significant deductible expenses. This regime allows for more detailed management of finances and can result in tax savings in the long term. However, it involves hiring a certified accountant and greater administrative complexity.

If you have an activity with many deductible expenses, organized accounting may be the best option for you.

In short, the choice between a simplified regime and organized accounting must be made based on your specific needs and the complexity of your activity. Evaluate your options carefully to make the best decision.

Frequently Asked Questions

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