Go Back   British Expats / Living & Moving Abroad / Europe / Portugal

Reply
 
Thread Tools
Old Nov 28th 2017, 3:48 pm   #1
Ted100 
Just Joined
 
Joined: Nov 2017
Posts: 2
Ted100 is an unknown quantity at this point
Default Non Habitual Residency (NHR) + Foreign Securites Trading

Hi

This is my first post

I am EU resident/citizen and looking at coming to settle in Portugal in 2018 (maybe around Cascais) and take up Non Habitual Residency (NHR). However I have a question which would be central to whether or not I apply for NHR.

I have an account with a US based broker where I trade US securities (Stocks and Options). Under NHR would I be liable for Capital Gains Tax or Income tax for such trades?

Many thanks

Ted100
Ted100 is offline   Reply With Quote
Old Nov 28th 2017, 5:03 pm   #2
Pilou Female
Forum Regular
 
Joined: Jul 2017
Location: Spain but soon Portugal
Posts: 232
Pilou is an unknown quantity at this point
Default Re: Non Habitual Residency (NHR) + Foreign Securites Trading

As far as I know, this is not tax exempt under RNH.
Dividends from outside Portugal are tax exempt under RNH (in general you pay withholding tax abroad).
Pilou is offline   Reply With Quote
Old Nov 28th 2017, 6:14 pm   #3
Ukkram Male
BE Forum Addict
 
Joined: Aug 2012
Location: Viana do Castelo
Posts: 1,065
Ukkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to all
Default Re: Non Habitual Residency (NHR) + Foreign Securites Trading

So you are trading derivatives or futures on margin. This is not investing and will not be CGT so NHR will give you relief but if you hold the stock for over 12 months then it will be regarded as CGT and you will pay 28% tax fixed rate.

However, you have a choice to include the long term trades over 12 months to your other income if any and be taxed at the sliding rate up to 48% if at max.

You are trading and it is the same as running a small business much like a shop and will pay tax accordingly,

Last edited by Ukkram; Nov 28th 2017 at 6:19 pm.
Ukkram is offline   Reply With Quote
Old Nov 28th 2017, 6:21 pm   #4
Pilou Female
Forum Regular
 
Joined: Jul 2017
Location: Spain but soon Portugal
Posts: 232
Pilou is an unknown quantity at this point
Default Re: Non Habitual Residency (NHR) + Foreign Securites Trading

Quote:
Originally Posted by Ukkram View Post
However, you have a choice to include the long term trades over 12 months to your other income if any and be taxed at the sliding rate up to 48% if at max.
I read that the income that is exempt under RNH will count for "other income". It won't be taxed but it serves to determine the progressive rate you need to pay on the income really taxable in Portugal.
Pilou is offline   Reply With Quote
Old Nov 28th 2017, 7:32 pm   #5
Ted100 
Just Joined
 
Joined: Nov 2017
Posts: 2
Ted100 is an unknown quantity at this point
Default Re: Non Habitual Residency (NHR) + Foreign Securites Trading

Thank you Ukkram and Pilou for your replies

Most of the trading I do is short term(less than 2 months) Options trading. For example I could buy Options on Google and then sell them less than 2 months later. Would this be classified as Income or Capital Gains in Portugal? My understanding is that it is classified as Capital Gains and would normally attract a flat tax of approx 28%.

If it is classified as Income, is this taxable under NHR?
Ted100 is offline   Reply With Quote
Old Nov 29th 2017, 8:51 am   #6
Ukkram Male
BE Forum Addict
 
Joined: Aug 2012
Location: Viana do Castelo
Posts: 1,065
Ukkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to allUkkram is a name known to all
Default Re: Non Habitual Residency (NHR) + Foreign Securites Trading

You are running a business for income so it would be taxed as such. Investing or holding stocks for over 12 months will be regarded for CGT when disposed.
This I am 100% sure of as I had been doing the same for 16 years.

The holding period varies between countries. Where I come from you have to hold for at least 3 years for the disposal to be considered as capital gains or loss.

As it is foreign income then NHR will give you relief. Only if the income is local will you pay a flat 20% rate.

I suggest you get professional advice as the tax authority may say that you applied your mind, wit and time in Portugal to earn the income and therefor you will pay the flat rate under NHR.
Ukkram is offline   Reply With Quote
Reply

Go Back   British Expats / Living & Moving Abroad / Europe / Portugal


Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off



All times are GMT. The time now is 12:44 am.


We are a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for us to earn fees by linking to Amazon.com and affiliated sites.
Powered by vBulletin: ©2000 - 2017, Jelsoft Enterprises Ltd.
© 1999-2010 BritishExpats.com