ricko

In that case, is it true that mutual funds held in the USA would be taxed by the USA but not Portugal?

Naaling

I'm not familiar with US mutual funds.
It would depend on US tax law and the details of any DTA.

Furfanus Postumus

Thanks for all the responses. If one were to delay establishing residence in PT until 1 Jan 2019 (greedy to get the full 10 years benefit), then to apply for NHR status (for upcoming PT tax year 2019) 3 months later (or earlier if allowed), say by end March 2019, might there be any risk that the scheme had by then been scrapped? There were lots of scare stories about recently that finance minister about to scrap it/amend it. When would the budget speech have to be to scrap NHR for 2019? It seems the 2018 budget was voted on in parliament on November 27 2017, so I assume Nov 2018 will be the date which will determine the fate of the NHR scheme for 2019 and beyond? So get in pre that date if risk averse, else hang on till after if you like living dangerously?

Loafing Along

For 2018 you can apply up to March 2019. Arriving in January 2019 you would not have to declare until April 2020 , hence the possibility to do the application until March of the year following arrival. Yes there have been reports in the press about potential amendments to the rules but rather than scrappage the focus has been on imposing a new low rate of tax , 5% or 10% hardly alarming considering the benefits. Personally I do not see that happening, in a separate report the Finance Ministry gave a summary of the benefits to the economy of the NHR scheme being tax taken , VAT etc, more than covered the tax losses through granting NHR status. At the end of the day we are talking about relatively insignificant numbers, less than 15,000 take up I think is the figure from last year.

Furfanus Postumus

Thanks Loafing Along, so I assume any alteration would be made in the November 2018 budget, which would affect any future applications made in respect of the 2019 PT tax year?

Ukkram

If the investments are in mutual funds or stocks on the stock market and pays dividends then the dividends can be paid to either country but most likely left to the country of residence. The DTA however caps the tax on dividends at 15%.. NHR may relieve you of any tax here.
If it is taxed as a withholding tax then it may not be more than 15% and PT has no rights to tax it.

If you sell all or part of your investments and it has a capital gain then the gain can only be taxed by PT as it is a residency based tax. In this case having NHR will not provide any relief and you will pay 28% flat rate tax. This is due to the DTA that states "Capital Gains Tax is only payable to the contracting state in which the alienator is resident".

Ukkram

It depends on whether you are a US citizen or not but the US is known for it's draconian tax laws and a DTA as thick as a bible.
Most DTA's are virtually copy and paste bar USA and a few obscure ones. It has to be made simple to make cross border trading as easy as possible.

Loafing Along

Interesting article in Jornal de Negocios the other day.
https://www.jornaldenegocios.pt/econ...l-com-portugal

The move against NHR coming from other European countries who "resent" the fact their tax payers taking advantage of the scheme. In this case Finland. A question of principle not money according to the Finnish Finance Committee.
This is the type of move I believe poses a greater threat to the scheme than a Portuguese government rethink.

Ash Jez

I'm in the BTL business and applied for the NHR scheme. I almost came unstuck because I confused dates and got approved about 10 days before the deadline. I used an accountant and she arranged everything from applying for my login details, submitting the NHR request (approved), filling by tax return etc. Euros 40. Some online companies try to charge a thousand for ticking a box as that's all that is required. If anyone wants the accountant details, PM me. I've not met her as all was done via telephone and email and she deals with a good few Brits and speaks reasonable English.

Barney2201

Hi, newbie here.... We are looking to move as a family to Portugal using the NHR scheme to minimize our tax. Please can you ping me details of the accountant you used? Also, you say you 'got approved 10 days before the deadline'. As far as I am aware the NHR scheme is still available, is this not the case? Thanks

soloyolo

Hi Ash,

I'm new to the site and am required to have posted publically on the message board at least three times before getting access to the private message feature... That being said I have sent you a message via your blog. Please, can you share details through there?

To anyone else - I'd have a look through Ash Jez's blog, its a really fun read.

soloyolo

Hi,

Did you have any luck finding a reasonably priced an accountant in the end? if so please can you share details? Hope the process went smoothly for you in the end.

AliceCaroline

I've checked the online portal after 4 days and my status says "Deferido" does that mean that the NHR has been accepted? I was expected it to say some like "aceito"

Loafing Along

Deferido means it's accepted. There should be a pdf you can download with it.

AliceCaroline

There is a pdf, I shall print it out

Thank you for the prompt reply Loafing Along.

I just got my good Portuguese - English dictionary out and it does say the verb deferir means; to confer; to grant; to concede.

I should have gone straight to it instead of using Google Translate which says deferred.