Moving to PT.... Advice needed please
 

Hi everyone, this is my first post,

I'm after some advice about moving to PT.

The story so far:-
Myself, partner and her step father are moving to PT early next year.
We all have Fiscal No's, access to a PT bank account and have bought a plot of land. Planning permission to build has been granted and a contract with a builder is now all sorted. Building work will start next week. Expect the house to be finished March 2020.

When the house is finished my partner and her step father will be moving in and will be 100% living in PT. I will, however, be moving over initially for about a month and will then be in the UK working for 5 weeks, and then in PT for 3 weeks on holiday. This will continually roll like that. (5 weeks UK, 3 weeks PT) for about 2 years until I retire.

I'm guessing that because I'm working (self employed) in UK still, my tax liabilities won't change to what they are now (pay my income tax in UK)?? I will also then transfer money from my UK bank to my PT bank on a monthly basis.
My partners step father has a UK state pension and also a private pension, could these also just be transferred over easily enough??
Would PT tax return forms have to be filled out each year, and if so what would the tax situation be?? (I'm led to believe that no tax is liable as any taxes would have been already paid in UK)??

Would all 3 of us apply for residency together (after 90 days) or would only my partner and her step father apply to start with and I then apply once I'm in PT permanently??

Will be grateful for any replies.

Re: Moving to PT.... Advice needed please
 

Moving money is easy.

You're meant to register residency not before 3 months & before 4 months but you can do it earlier if you wish & to remain a resident of Portugal you need to be in Portugal for 6 months of every year which is going to be a problem for YOU & it'll probably become a much bigger problem when Brexit is complete because free movement will probably be lost.

However if you do register residency & can make a plan to get over those issues you might well be able to take advantage of NHR status which gives a 10 year tax holiday on most but not all foreign income.

Also be aware that Portugal often suffers from acute variable bureaucracy syndrome & different civil servants will often have different rules & procedures as other civil servants but that is the way it's meant to work

Re: Moving to PT.... Advice needed please
 

When you have a home available to you in Portugal and your centre of life is in Portugal (wife and home) plus Portugal becomes the "country you return to after your wanderings" you will be tax resident in Portugal. You tick all the boxes for tax residency in Portugal.

According to the DTA: The industrial or commercial profits of an enterprise of a Contracting State shall be taxable only in that State. (Meaning UK) You would need to consult with UK accountants.

Your wife's stepdad will pay UK tax on his state pension but with NHR status his private pension will be exempt in both countries.

I may have become a bit rusty on this so please get advice.

Re: Moving to PT.... Advice needed please
 

Why should he pay tax on his UK State Pension ? If he moves here and completes the necessary UK paperwork to avoid Double Taxation and is under the NHR scheme surely both pensions would be tax -free for ten years.

Agree entirely with your comment about "Centre of Interest/Life" - with house and wife here Portuguese tax authorities would have good grounds to claim tax here. He has to get advice

Re: Moving to PT.... Advice needed please
 

My apologies. Got thrown off with the diffs between State and Gov pensions as I'm not a Brit.

The DTA only allows the UK to tax government pensions.

UK state and private pensions are taxed only by Portugal because the OP's father in law will be tax resident in Portugal.

NHR will not provide any exemption to remuneration that can only be taxed by Portugal. This includes certain Capital Gains.This however has been refuted by some members.

Re: Moving to PT.... Advice needed please
 

Do you own or rent a home in the UK and will you continue to do so during this period?

There's nothing difficult about transferring money but there is a cost involved in the DIY, however you do it. It might be worth thinking about having the money paid directly into PT bank accounts rather than you doing the transferring, as a more efficient and cheaper way of receiving the money, unless there's a particular reason to use the UK account - the UK government will certainly do this for you with the state pension for no charge.

Re: Moving to PT.... Advice needed please
 

Many thanks for all your replies.

Ref transferring money ---- Up to now I have been using Transferwise. All transactions to the PT account have been seamless. I probably intend to continue using them, unless there are more efficient ways to transfer.

When the house in PT is finished I will be selling the UK house. When I am in the UK working I will be basically renting some form of accomodation (hotel, B and B) for the 5 weeks and then over to PT for 3 weeks break.

I plan to keep my UK bank accounts (will change my address with them to my sister's address) for the occasions that I will be working in the UK. My thinking of keeping my UK accounts is that in the future if I do decide to do the odd contract in the UK then my LTD company, UK accounts etc etc will still be active and I won't have the hassle of opening a new LTD company or bank account.

Does that all make sense??

Re: Moving to PT.... Advice needed please
 

Can't fault the logic there but for your partner's step-father get the UK State pension paid directly into a Portuguese bank account. UK govt gives the best rate with zero charges. Easy to arrange through Social Security..

Re: Moving to PT.... Advice needed please
 

Good advice...... Many thanks.

Re: Moving to PT.... Advice needed please
 

Another question:-

Once I've fully retired and living off my savings that are sat in a UK account (and transferred to my PT bank as and when required) would I have to fill out a tax return form in PT every year??

If yes, would I be liable for PT tax??

Re: Moving to PT.... Advice needed please
 

Yes. You can reduce your liability by registering under the NHR scheme.

Re: Moving to PT.... Advice needed please
 

That doesn't seem fair that I would have to pay PT tax on my UK savings that I'm transferring. Surely I've already paid the tax on the savings in the UK??

Or am I missing something here?

Re: Moving to PT.... Advice needed please
 

As a Portuguese resident you fall under PT tax jurisdiction
If the PT tax due is higher than that already paid in the UK. You pay the difference.

Re: Moving to PT.... Advice needed please
 

Many thanks for your reply

Sounds like the easiest way is to transfer all savings to PT bank before becoming resident.... Starting to get confused now.

Re: Moving to PT.... Advice needed please
 

Have you looked into NHR status.