NHR status portugal
#61
BE Forum Addict
Joined: Aug 2012
Location: Viana do Castelo
Posts: 1,385
Re: NHR status portugal
Financial websites are littered with words like "may, could, possibly and potentially" be tax free. One website says that there is no tax free holiday while another says to come to PT and enjoy a 10 year tax free holiday. Who to believe? Most make their money from property and need clients.
Look what nonhabitualresidents.com says. I quote below.
//A Non-Habitual Resident (“NHR”) will be exempt from personal income tax on certain types of qualifying income if this income is subject to tax in the country of source under an existing Double Tax Treaty that allows for this//
In the 4 years that we have been here not one member of this forum have given first hand experience except me despite people asking.I repeat here. Capital Gains Tax on investments get no relief with NHR because the DTA states that it may only be taxed by Portugal. This is 100% correct as confirmed by 4 tax returns.
According to the DTA UK - PT, some pensions can only be taxed by Portugal so as per my example above on CGT then there is a possibility that both will be treated the same. Unless someone can confirm that it is not taxed I will be on the fence with this.
Look what nonhabitualresidents.com says. I quote below.
//A Non-Habitual Resident (“NHR”) will be exempt from personal income tax on certain types of qualifying income if this income is subject to tax in the country of source under an existing Double Tax Treaty that allows for this//
In the 4 years that we have been here not one member of this forum have given first hand experience except me despite people asking.I repeat here. Capital Gains Tax on investments get no relief with NHR because the DTA states that it may only be taxed by Portugal. This is 100% correct as confirmed by 4 tax returns.
According to the DTA UK - PT, some pensions can only be taxed by Portugal so as per my example above on CGT then there is a possibility that both will be treated the same. Unless someone can confirm that it is not taxed I will be on the fence with this.
Last edited by Ukkram; Sep 6th 2018 at 3:10 pm.
#62
BE Enthusiast
Joined: Nov 2017
Posts: 569
Re: NHR status portugal
http://info.portaldasfinancas.gov.pt...IRS_RNH_EN.pdf
page 8
3 (b)
I'm happy to follow the financas lead
page 8
3 (b)
I'm happy to follow the financas lead
#63
BE Forum Addict
Joined: Aug 2012
Location: Viana do Castelo
Posts: 1,385
Re: NHR status portugal
3 - Income in category H (pensions) - paragraph 6 of Art.º 81.º of the CIRS Portuguese non-regular residents that have obtained category H incomes in foreign countries, have exemption if these incomes are from contributions that have not been deducted under Paragraph 2 of Art. 25. of the CIRS and if the conditions below are met:
a) They are taxed by the source State/nation, according to the convention to eliminate double taxation held by Portugal and the source State; or
b) They cannot be considered to have been obtained on Portuguese territory as per Art. 18, paragraph 1 of the CIRS.//
End copy and paste.
So 3 (a) or (b) must be met to get exemption.
(a) is not met as it is a residence based tax. (b) is met as it is not obtained on PT soil.
To me this means that personal pension is exempt.
I was however perturbed by the wording "if it is taxed in the other state" for exemption to apply here for other incomes.
a) They are taxed by the source State/nation, according to the convention to eliminate double taxation held by Portugal and the source State; or
b) They cannot be considered to have been obtained on Portuguese territory as per Art. 18, paragraph 1 of the CIRS.//
End copy and paste.
So 3 (a) or (b) must be met to get exemption.
(a) is not met as it is a residence based tax. (b) is met as it is not obtained on PT soil.
To me this means that personal pension is exempt.
I was however perturbed by the wording "if it is taxed in the other state" for exemption to apply here for other incomes.
#64
Forum Regular
Joined: Nov 2011
Posts: 39
Re: NHR status portugal
ukkram
I am coming to portugal from the uk and fully expect my pension to be paid free of any tax under NHR , yours is the only voice that says this is not allowed.
Maybe your case is different to everyone elses - I don't know your circumstances, but everything I read tells me I will satisfy the rules and will enjoy a pension paid free of tax for 10 years
I am coming to portugal from the uk and fully expect my pension to be paid free of any tax under NHR , yours is the only voice that says this is not allowed.
Maybe your case is different to everyone elses - I don't know your circumstances, but everything I read tells me I will satisfy the rules and will enjoy a pension paid free of tax for 10 years
All the above information most useful - thnxs to everyone.
Very interesting point made by ukkram - this is the sort of thing that I have been concerned about.
With the experience gained from operating my own Company I discovered over time that many tax saving schemes in fact cost more in the long run than simply 'paying the piper'.
But as Mac & Mabel suggested - so for me also - it would make the difference in my decision to 'give it go' - in particular in the later stages of life.
Thnxs all.
#65
Banned
Joined: Oct 2012
Posts: 26,724
Re: NHR status portugal
ukkram
I am coming to portugal from the uk and fully expect my pension to be paid free of any tax under NHR , yours is the only voice that says this is not allowed.
Maybe your case is different to everyone elses - I don't know your circumstances, but everything I read tells me I will satisfy the rules and will enjoy a pension paid free of tax for 10 years
I am coming to portugal from the uk and fully expect my pension to be paid free of any tax under NHR , yours is the only voice that says this is not allowed.
Maybe your case is different to everyone elses - I don't know your circumstances, but everything I read tells me I will satisfy the rules and will enjoy a pension paid free of tax for 10 years
#66
BE Enthusiast
Joined: Nov 2017
Posts: 569
Re: NHR status portugal
but that would need a new dta drawn up between portugal and uk
Provably take 20 years to implement , I'm happy to take that risk
(you scare mongerer you)
😀
Anyway that decision would lie with portugal
Provably take 20 years to implement , I'm happy to take that risk
(you scare mongerer you)
😀
Anyway that decision would lie with portugal
Last edited by dingg; Sep 7th 2018 at 11:53 am. Reason: Add
#67
Re: NHR status portugal
The UK doesn't actually appear at all bothered about it. Not enough to make unilateral changes, anyway.
Changes at the Portuguese end have been rumoured, allegedly on account of complaints by other EU member states but Portugal appears reluctant to do anything for nothing in return. There are other countries operating tax advantage schemes of various sorts which Portugal would like discussed along with its own.
In the case of Finland, it was easy for them to exert pressure because their existing DTA with Portugal was due to expire anyway. I believe that whatever compromise was eventually agreed led to a 3 year transition period, so even after the resolution was agreed, there were residual benefits for Finnish NHR pensioner beneficiaries.
Changes at the Portuguese end have been rumoured, allegedly on account of complaints by other EU member states but Portugal appears reluctant to do anything for nothing in return. There are other countries operating tax advantage schemes of various sorts which Portugal would like discussed along with its own.
In the case of Finland, it was easy for them to exert pressure because their existing DTA with Portugal was due to expire anyway. I believe that whatever compromise was eventually agreed led to a 3 year transition period, so even after the resolution was agreed, there were residual benefits for Finnish NHR pensioner beneficiaries.
#68
BE Forum Addict
Joined: Aug 2012
Location: Viana do Castelo
Posts: 1,385
Re: NHR status portugal
There is talk that this may be the last year for NHR applications. Haven't got the link but it should be simple to find.
#69
BE Enthusiast
Joined: Nov 2017
Posts: 569
Re: NHR status portugal
Those rumours have spurred me into action before year end to get it sorted rather than gamble and get hit with a change in 2019
Just means split year treatment and a lot of calculations to do :-( for 18/19
Just means split year treatment and a lot of calculations to do :-( for 18/19
#70
Banned
Joined: Oct 2012
Posts: 26,724
Re: NHR status portugal
Ever heard of Brexit , take nothing for granted as far as the future status of Brits in Portugal.
The Swedes are already considering ending the passporting of pensions tax free.
Ending tax free passporting of income is not down to Portugal but the country of origin of the income...
IN addition given the recovery of the Portuguese economy and property market there is no longer the need for Portugal to subsidise part time and full time foreign .residents....
#71
BE Enthusiast
Joined: Nov 2017
Posts: 569
Re: NHR status portugal
Oh Dear
I take it you don't qualify for NHR?
I take it you don't qualify for NHR?
#72
Re: NHR status portugal
This in the face of some very cogent arguments and pertinent questions being asked from within (again and just this week by a spokesperson from the BE, for example) as well as from outside the country.
#73
Banned
Joined: Oct 2012
Posts: 26,724
Re: NHR status portugal
I may well do but Its not the reason I chose Portugal, I also have come to know just how much better off we expats are than the Portuguese who cannot avoid paying tax ..
There are many , 100s maybe thousands who have abused the NHR process by pretending to live in Portugal when they do not having just bought a basic or rented a property often encouraged by estate agents with the NHR benefit...
It has had its time .
There are many , 100s maybe thousands who have abused the NHR process by pretending to live in Portugal when they do not having just bought a basic or rented a property often encouraged by estate agents with the NHR benefit...
It has had its time .
#74
Re: NHR status portugal
I may well do but Its not the reason I chose Portugal, I also have come to know just how much better off we expats are than the Portuguese who cannot avoid paying tax ..
There are many , 100s maybe thousands who have abused the NHR process by pretending to live in Portugal when they do not having just bought a basic or rented a property often encouraged by estate agents with the NHR benefit...
It has had its time .
There are many , 100s maybe thousands who have abused the NHR process by pretending to live in Portugal when they do not having just bought a basic or rented a property often encouraged by estate agents with the NHR benefit...
It has had its time .