dickydog

Hello guys,
me again, you never seem to let me down, for that many thanks.

As our move to Coimbra is now close, I was wondering about all things financial and the best way to approach it, we have English pensions and a modest sum tucked away in English accounts.

I know a little about the changes to NHR scheme post Brexit and I,m looking for advice and/or recommendations

many thanks
chris

Alan PT

Rather a broad question, but I can start you off!

Portuguese tax year is calendar year, so if you become resident before January then you will need to do a return for tax year 2021. This guide is for 2021 (ie 2020 tax year), but timescales will be similar: https://www.doutorfinancas.pt/impost...sar-os-prazos/ (Google Translate works OK on this!)

You can also find some more info on getting assistance for tax returns in this thread: Tax return online

Open a Portuguese bank account soonish - I recommend Activobank, it's free and online services in English. Also open a multi-currency account with https://wise.com/ - you can get your UK pension paid in there and then converted to euros cheaply (and it'll give you a backup place to hold pounds if your UK bank decides to close your account, as they might)
- just my opinion of course, but both pretty non-controversial choices, they both have good value and good service

DON'T respond to the multiple "financial advisors" who will somehow find your details and phone and email you, telling you they are "helping people with pensions from (company you worked for)". Don't let them scare you - there is no danger in keeping your UK pension as it is and likely very little benefit (and some high charges) if you transfer. You can always review this at your leisure, once you seek out a financial advisor who you trust

Alan PT

A sample of the approaches I get every few weeks on LinkedIn from one of these commission based sales people, often working for a group we seemingly can't name, but let's call it Ve Dere...

"At XXXX we work with deferred members of the XXXX UK Pension scheme.
Our specialty is those members who are now based abroad, and we have an expert adviser who deals with EU residents and explains their options within Portugal.
Do you have 10 minutes next week for a brief introduction, to assess your situation and see which solutions are out there, could be of interest to you?"

It's carefully worded to make you think that they are working in some official capacity with the pension scheme, when in reality they have just cut & pasted it from your work history. If you are unlucky enough to answer a phone call from one of them, they will follow the classic high pressure sales training and refuse to take No for an answer. I've taken to saying "No thank you, have a lovely day, goodbye" and hanging up the phone as they keep speaking

liveaboard

That's the problem with most all financial advisors.
And even with the best intentions, they often don't know what they're doing.

A friend and neighbor of mine had a financial advisor girlfriend, she advised him to invest his savings in tech stocks, just before the tech crash of 2002.
He lost everything.
Including his relationship.

Sorry, this isn't a very positive contribution.
All I can say is, the best is to invest in an area you're knowledgeable about, if you can.

Rambling archer

A suggestion - BEFORE you move, check on your UK bank and your various pension providers (if you have other than the State Pension) to check

1. If you can keep your bank account open - some have decided after Brexit to no longer support (let alone allow new) accounts where the holder is Resident in the EU, and it varies from country to country in the EU as per local regulations (now that the EU no longer provides UK banking with cover on rules and regulations). Barclays was one that shut some EU residents' accounts if I remember rightly. So far LLoyds and I think also NatWest? can maintain your UK current account, but NOT savings accounts or Credit cards (Debit cards are OK) ...

2. Will your pension provider pay direct into a PT bank? Some will, some will ONLY pay into UK account which can be a real problem if you cannot keep your present UK bank account! So check well in advance.

On another subject, the NHR (which will give you the opportunity to only pay 10% on income from outside PT - except from what PT sees as tax havens !) starts its 10 years from whenever you register as Resident, so it would probably be better since it is now so late in the year to register from January onwards - 2022 - to simplify taxation and to benefit from your full 10 years. And then once registered as Resident and with your NIF, register with the Portal das Finanças which deals with the tax affairs in PT, and once logged in there you fill in a section to declare your status as NHR including the YEAR when you registered as Resident. http://www.portaldasfinancas.gov.pt/at/html/index.html- very useful site though somewhat complicated to navigate!

Alan PT

Yeah, it's a bit messy with different banks making different decision. Still have both current and savings accounts with First Direct and Nationwide, both of whom are fully aware that we are PT residents) also a couple of credit cards - although the cards asked for a UK address, even though they were OK with the PT residency

ISA's are a little more complicated - you can keep them, but not contribute more and it's debatable how much use they are anyway since there is still a PT tax liability

dickydog

Thanks for the information friends and keep it coming, we have a pt millennium account, I have a nif number and can see the possibility of my English bank Barclays noting me out after 35 years of banking, the wise account maybe a great way forward as I can pay my private pension directly into there, another 14 years to go before state pension age.

I have always appreciated the support on here for the best part of ten years I reckon, many thanks
chris

Rambling archer

But do check with Barclays - it has nothing to do with how long you have been a loyal customer and everything to do with whether Barclays want to fork out for complying with the new after-Brexit banking regulations!! And maybe see a Manager rather than a chat with a teller ... It is always good to keep a UK account going and if you need to change, now is the time to do it as keeping an account set up while UK resident is a lot easier and more practical than trying to set up a new one after you have moved.

dickydog

I thought about just not telling them, everything is online anyway.

Alan PT

It's tempting, but probably not advisable. To be honest, we did do that for a while after moving, just to give us time to sort things out in case they did cut us off, but it always made me a bit nervous as I've no idea where you'd stand in terms of FSCS protection for instance. Anyway, at some point you'll need replacement cards, which will be sent to the address they have for you...

Red Eric

Apologies in advance for pedantry here.

The 10% flat rate applies only to pension income from abroad. Most other foreign-sourced income would be totally exempt from PT tax under NHR - income from savings and investments, for example, which has a default rate of 28% for PT tax, would be zero for the period NHR applies.

dickydog

Two great points there, many thanks, the cards being sent to the address, never thought about that and the NHR not taxing my savings, thanks guys

Alan PT

Worth buying a copy of the Blevins Franks book for a good overview of Portugal tax and NHR (or you could wait for one of their seminars and get it for free, but it's pretty cheap anyway!) https://www.blevinsfranks.com/produc...g-in-portugal/

You can also download a few free guides from their website for the cost of your contact details. They will contact you to try to sell you their financial planning services (which are pretty good, but expensive) but they aren't too pushy or persistent

Loafing Along

On NHR don't pay someone a fortune to register you ! You can do itself on the Finanzas web with a little help from a Portuguese speaker - it is a very simple process once you have an address in Portugal and are registered with a NIF

appman999

Is an issue if you maintain a UK residence?

We are now thinking of becoming resident in Portugal to overcome the Brexit shambles but will spend nearly half the year back in the UK.