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Old Aug 5th 2017, 2:30 pm   #46
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Default Re: Step by Step - Arrival in Portugal

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Originally Posted by factseeker View Post
Hi,
Thnxs for reply.

So to summarise as I understand it - provided all goes reasonably smoothly in the paperwork etc - all is correct and one follows the correct proceedure - it should be possible to obtain a confirmation of NHR within circa a month of initial arrival in Portugal??

Best Rgds.
Do remember that, in theory, you cannot apply for residency until after your first 90 days . Until then you are still a tourist. Once that hurdle passed , yes about one month to do everything.
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Old Aug 5th 2017, 2:31 pm   #47
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Default Re: Step by Step - Arrival in Portugal

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Yes :-)
wow!
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Old Aug 5th 2017, 4:37 pm   #48
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Default Re: Step by Step - Arrival in Portugal

I have been researching PT tax all week regarding my NHR status. Very disappointed with my tax bill of €12k. What a waste of time. Seems like this status only works in your favour if you have already paid taxes in the UK or whatever country you from and receive the money.

You will score only if PT taxes are higher than the country you earn the money from. You can elect the country you want to pay tax to if the DTA states so.

Had I paid tax to South Africa I would have paid half the amount.
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Old Aug 5th 2017, 9:43 pm   #49
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Default Re: Step by Step - Arrival in Portugal

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Originally Posted by Ukkram View Post
I have been researching PT tax all week regarding my NHR status. Very disappointed with my tax bill of €12k. What a waste of time. Seems like this status only works in your favour if you have already paid taxes in the UK or whatever country you from and receive the money.

You will score only if PT taxes are higher than the country you earn the money from. You can elect the country you want to pay tax to if the DTA states so.

Had I paid tax to South Africa I would have paid half the amount.
I don't get this. Foreign sourced income, including most UK pensions, will not be taxed in the UK, and under NHR will also not be taxed in PT. Income from UK rents is taxable in the UK, but the UK personal allowance is (at least for now) available, so an expat couple could receive £23k rental income without any UK tax, and with no PT tax, either. Double taxation rules, I am sure, are quite explicit and do not give you the option to elect a country to pay tax to; as long as you have applied for and been granted NHR you should not have to pay tax on anything other than Portuguese sourced income.

Without asking you for figures, could you explain the sources of your income?
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Old Aug 5th 2017, 9:48 pm   #50
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Default Re: Step by Step - Arrival in Portugal

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Originally Posted by Ukkram View Post
I have been researching PT tax all week regarding my NHR status. Very disappointed with my tax bill of €12k. What a waste of time. Seems like this status only works in your favour if you have already paid taxes in the UK or whatever country you from and receive the money.

You will score only if PT taxes are higher than the country you earn the money from. You can elect the country you want to pay tax to if the DTA states so.

Had I paid tax to South Africa I would have paid half the amount.
Is it not more to do with the source and status of income.
.EG pensions vs dividends.
Certain incomes qualifying for NHR status others do not.
Those incomes that are not subject to NHR being taxed at the higher PT rate if not taxed at source.

Maybe your issue is more about the advice you were given , ?
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Old Aug 6th 2017, 8:56 am   #51
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Default Re: Step by Step - Arrival in Portugal

The NHR act is very complicated and has undergone some changes over the years.
PwC and KPMG has not amended their versions for years and are outdated. The best place to read it would be on portal.finanças.gov.pt.

I earn Capital from Investments with Dividends and could fall in the E or G groups of types of income depending on "if read together with Article 10.1 (b), (e) and (f)". Very confusing.

The DTA states that Dividend Withholding Taxes are to be paid at source but is capped at 15%. "Capital Gains Tax "MAY" be paid to the other state."

The finanças website states that "if CGT was paid to the other state then the difference of the 28% tax for NHR residents must be paid to PT". A flat NHR rate of 28% must be paid to Finanças if not paid to the other state.

No deductions are allowed for Medical, Dependents, non working spouse etc.

Under the NHR scheme, foreign earnings "MUST" have been paid to the other state to get full exemption here.
Even my accountant is confused and has been waiting for advice from the Accountant Board Forum for a week now.
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Old Aug 6th 2017, 9:39 am   #52
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Default Re: Step by Step - Arrival in Portugal

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Originally Posted by Ukkram View Post
The NHR act is very complicated and has undergone some changes over the years.
PwC and KPMG has not amended their versions for years and are outdated. The best place to read it would be on portal.finanças.gov.pt.

I earn Capital from Investments with Dividends and could fall in the E or G groups of types of income depending on "if read together with Article 10.1 (b), (e) and (f)". Very confusing.

The DTA states that Dividend Withholding Taxes are to be paid at source but is capped at 15%. "Capital Gains Tax "MAY" be paid to the other state."

The finanças website states that "if CGT was paid to the real state then the difference of the 28% tax for NHR residents must be paid to PT". A flat NHR rate of 28% must be paid to Finanças if not paid to the other state.

No deductions are allowed for Medical, Dependents, non working spouse etc.

Under the NHR scheme, foreign earnings "MUST" have been paid to the other state to get full exemption here.
Even my accountant is confused and has been waiting for advice from the Accountant Board Forum for a week now.
You are of course right and it is time that those in the real estate and some expat financial advisors stopped suggesting that NHR status provides tax free residence in Portugal.
What it can do is give exemptions on " certain " sources of income, but not all.

Last edited by EMR; Aug 6th 2017 at 9:41 am.
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Old Aug 6th 2017, 11:04 pm   #53
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Default Re: Step by Step - Arrival in Portugal

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You are of course right and it is time that those in the real estate and some expat financial advisors stopped suggesting that NHR status provides tax free residence in Portugal.
What it can do is give exemptions on " certain " sources of income, but not all.


Imagine the following, indeed extreme, example - an experienced NHS consultant takes an early retirement at 58 and goes to Portugal. NHR is not a problem at all so he gets that easily. And he works few weeks a year in a local hospital, otherwise enjoying his retirement.

Now let's consider the following alternative sources of UK income he may have while NHR in Portugal:

1. He goes to work occasionally in the UK as a consultant and earns £20,000 pa either as an employee, or as a self-employed. This would be exempt from Pt tax, with only UK tax payable.
2. He has a BTL portfolio in the UK managed by his UK Ltd company, which earns him dividends of £20,000 pa. This shouldn't be exempt from Pt tax and tax in Pt would be paid in addition to UK tax as any dividends from BTL have nothing to do with his profession that earned him NHR status in the first instance.
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Old Aug 7th 2017, 8:12 am   #54
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Default Re: Step by Step - Arrival in Portugal

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Originally Posted by DiDAN View Post
Yes :-)
Thnxs for your time spent.

Will give it a go - see no reason why will not be OK.

Best Rgds.
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Old Aug 7th 2017, 8:51 am   #55
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Default Re: Step by Step - Arrival in Portugal

To import your car from another EU country into Portugal will take how long? Is it better to ask help from a professional to do this?
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Old Aug 7th 2017, 8:54 am   #56
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Default Re: Step by Step - Arrival in Portugal

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To import your car from another EU country into Portugal will take how long? Is it better to ask help from a professional to do this?
Takes a lot of paperwork, best to get a Customs agent, they charge about €400,- Process can be quite quick, ten-fifteen days if you have all the paperwork that is necessary
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Old Aug 7th 2017, 8:58 am   #57
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Default Re: Step by Step - Arrival in Portugal

We will have all the paperwork, so approx 2 weeks is quite quick.

Does anyone know a Customs agent/ specialist in the Algarve who can help us with this?
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Old Aug 7th 2017, 10:17 am   #58
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Default Re: Step by Step - Arrival in Portugal

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We will have all the paperwork, so approx 2 weeks is quite quick.

Does anyone know a Customs agent/ specialist in the Algarve who can help us with this?
I used Faotir in Faro - central location and close to Customs office. Charged €400.-
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Old Aug 19th 2017, 6:58 am   #59
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Default Re: Step by Step - Arrival in Portugal

In this thread I can find a lot of useful info!!!
Thanks!!
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Old Aug 19th 2017, 4:54 pm   #60
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Default Re: Step by Step - Arrival in Portugal

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Originally Posted by Pilou View Post
In this thread I can find a lot of useful info!!!
Thanks!!
As I said, it gets complicated. If the DTA states that PT has sole rights to tax you on your foreign earnings then the NHR status will be void and you will pay the same tax as locals.

My misunderstanding of the word "property" has cost me a large tax bill here. It is not bricks and mortar only. It includes investments in stocks and other securities.

Had I stayed in South Africa, my tax would be 3x less than here.
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