Re: Registering for residency
 

Thanks TonyJ and Realme. Yes, I told HM's that I was exiting the country. They were probably quite happy to see the back of me since I was stuck on ESA for the past year and a half. The UK is a great place for those you want to be completely dependent on the state and for banksters. And "they" don't like anyone popping outside their allocated pigeonhole. I'm not registered as self employed in the UK so do I still need to to submit a UK tax returns form? It looks like I should register for this NHR scheme here but 28% tax rate doesn't fill me with joy.

Re: Registering for residency
 

To qualify under NHR you would have to be one of the " selected " professions, would that apply in your case.
As Tony says you should be submitting a PT tax return, as a Resident you are on the system so one day they will be in touch.

Re: Registering for residency
 

Not quite right. You can still apply to be registered on scheme, and what it means is that the reduced tax rates / tax free in some cases, only apply to the professions listed.

Other income, depending on source country may be tax free (dividends, interest, capital gains on sale of shares - but again depends on the source of this income. Dividends etc from a country on the Portuguese black listed cannot benefit from this tax free regime.

The other point is that if you are a permanent resident in Portugal, you cannot legally choose to pay your taxes elsewhere. You are liable to taxes here. The choice is between being legally here and taking advantage of tax breaks where they are available or not being tax compliant and hope that you are never caught, or if you are caught, suffer whatever consequences there are (same as in any other country).

Re: Registering for residency
 

Will you be registered as self employed here? if so, you need to get yourself set up as a "trabaladhor Independente" and state your activity. You then present invoices online and get taxed according to your worldwide income, with the tax year running from January to December. The things to watch out for are social security payments, which increase according to your earnings, although you can apply for exemption in the first year. Also, if you earn more than 1000 euros, you have to register for VAT. The personal allowances are very small and the tax rates quite high :0( I don't have any professional financial qualifications, just telling you what we have found out. I am not sure if you are already a resident and have been for a while that you would qualify for NHR, but someone with more knowledge that I will be along I'm sure.

Re: Registering for residency
 

Thanks Realme. It does appear to be complicated. Trabalhador Independente does seem the like the path I'll have to go down. Hope the gardening is going well. I've had lots of germination but they have sort of stagnated after the initial spurt of growth. My 2 tomato plants planted back in March have suddenly revived and have so I have a stream of cherry tomatoes which is nice as I had all but given up on them :). The Clematis I brought over is doing surprising well in the heat too.

Re: Registering for residency
 

I live in Portugal and work in the UK - similar situation.

You need this link and find out from the offices for your own circumstances:

HM Revenue & Customs: Tax treaties in force - P

http://www.hmrc.gov.uk/taxtreaties/i...rtugal-dta.pdf

I get my UK tax return sent to me in Portugal and remain UK resident, living in Portugal some of the time !

Accountant said that as long as tax is paid in either the UK or Portugal then that's not a problem.

Portuguese accountant said there's something to declare if any earnings are from Portugal and that non residents pay tax on Portuguese rental properties.

The fact I work in the UK, the family income is from the UK and we have permanent residences in both countries, we can still file for the IMI exemption if the Portuguese property is a permanent home rather than a holiday home.

Also have a Portuguese Social Security paper that states the income from the main earner is exempt from payment of Portuguese Social Security payments (that person is on a UK State Pension and due to this, the country that pays that State Pension also has to be pay for that person's social welfare (including EHIC cards etc.).

No need for a tax return to the Financas either even though we have an IMI exemption for property tax - nor is it possible for us to apply for permanent residency in Portugal (even if we live here full time) as long as our earnings and taxes are earned/paid in the UK and we have a permanent residence in both countries.

In fact, it is impossible for us to obtain an EHIC in Portugal until registering as working which would give us a Portuguese Social Security number (confirmed by lawyer and account) and as that isn't going to happen, our residency status remains as UK resident even if we decide to stay in Portugal for over 6 months.

We DO however have to register our presence at the local Junta de Freguesa (Atestado do Residencia) which cost us time to find the office, 1 Euro each making sure we carried with us our passports. You MAY need a paper from the property or rental agreement I'm not sure - we were known as buying a house in this Freguesa given it's a very small area and word gets around.

Can't find the email at the moment but the EU Advice line confirmed that bi-lateral agreements count between countries and that EU regulations on residency is to ensure that at least one EU country pays for social benefit rights (maternity, health etc.) and that between the 2 countries the individual's residency (rather than place he lives) is determined.

If you want further clarification as to where to find the information to check for your own individual circumstances, I find this a great source:

Your Europe Advice - Your Europe - Citizens

This portal has provided me with links to the various departments for all types of things including tax and residency status whereby forums members can only vaguely advise on certain topics rather than providing information as a "whole".

Oh - and I know friends who had to take the EU regs with them to the Camera to show the Camera that they had the right to apply for a residency permit.

I think the reason that residency isn't questioned in Portugal is due to the bi-lateral agreement between the UK and Portugal.

Individuals will need to check on bi-lateral agreements if the UK is not involved in the equation with Portugal, although I have a feeling personally that they are all pretty similar but yes, in circumstances not very clear cut (I work via the internet too for UK companies), then it's not that easy and can take some time to sort out.

Hope that helps.

Re: Registering for residency
 

Are you Portuguese Resident ?
If so you will have to submit a tax return to the Financas even if your income is fom the UK and tax paid there.
You only get IMI exemption if you are Portuguese Resident it is not sufficient ti just own a property.

Re: Registering for residency
 

Residence is a question of fact. Under the Portuguese rules, if your permanent home is in Portugal then your are subject to tax in Portugal - the Portuguese code incorporates the definition but in essence the taxpayer spends more than 183 days or if he has his permanent home in Portugal on the 31 December. UK as other countries have similar rules. There could be instances that a taxpayer could be subject to tax in both countries. If that is the case, there are procedures that a taxpayer could institute under double tax treaties to ensure that he is taxed in only one country (usually time consuming and costly). In spite of your earnings being in the UK, if your center of life is in Portugal, then you should be taxed here. If it is vice versa then you should be taxed in the UK. In your post, you seem to be in doubts that you have been correctly advised.

There are many instances of Portuguese residents that carry on paying their taxes in their 'home' country, but that does not mean that the tax is being paid correctly. If the the taxpayer should be found out, the local revenue authorities will not condone taxes being incorrectly in another country in spite of what an accountant says, though perhaps arguable but no assurance that will forgive. Could be the case also that they are never found out.

It is usually advisable for a taxpayer to organise his life so that he is not caught within 2 systems at the same - life is simpler, rather than to try have own rationale / arguments.

You also seem to confuse legal residence with tax residence - the 2 are separate issues.

Re: Registering for residency
 

Both EMR and Tony are correct. This thread is a good illustration of the fact that there are plenty of accountants who give incorrect advice.

If you are fiscally resident in Portugal (which you ARE if you live here for more than 183 days per year, whether you like it or not) you should be doing a tax return.

Re: Registering for residency
 

Of course, thousands of people do not.

I doubt that there is anybody here who doesn't know of dozens of such "under the radar" people, many of whom are, with dubious advice from various accountants, under the impression that they are doing absolutely nothing wrong.

Re: Registering for residency
 

Got my Residencia today. NewInTavira was right. It was all fun and games. I got there in the end after making four trips to the camara and having begged some kind Portuguese people for their signatures. It is definitely a different one from the Residency document you get from Financas. The Residency doc from the Finanças will suffice if you not likely to be taxed under the Portuguese system and don't require anything else that goes with this.

Re: Registering for residency
 

Finally after 6 months my non EU wife has got her 5 year residencia. Now the next fight starts. Paying Exit Tax to South African IRS.

Re: Registering for residency
 

Good to hear you finally got it.
6 Months is a long time to be uncertain about your future.

Re: Registering for residency
 

you have my sympathy with that...... the reserve bank and SARS combined are an absolute bunch of bastards!

Re: Registering for residency
 

You should look closely at this. There is a 2012 SA tax case (facts going back to 2002), where SARS lost to the tax payer on exit taxes. More recently, the SA Reserve Bank lost on the Mike Shuttleworth exit charges (kind of tax imposed by the SA Reserve Bank without proper authority).

I have not fully kept up on whether the SARS has altered the law to counter the above loss, which is more than likely, but if your bill is material enough, it might be worth looking into, in view that there is a DTA between SA and Portugal.

If you need further details - look through google - a lot of information readily available or send me a PM.