PJC61

Hello,
We came to Portugal at the start of July and obtained residency at the end of October. Due to the timing of our move with Brexit, we decided to use the services of a solicitor and they took care of everything and did a superb job. This morning they emailed asking me to apply for and fill out a S1 form for Portuguese social security.

We have taken early retirement and not drawing the UK state pension.
We fund our lives from renting our house in the UK and savings.
I have had a look at the government web site and S1 forms seem to be issued to people receiving the UK state pension or other benefits only.

Before I speak to the solicitor (and probably make myself look stupid), can anyone on here explain why they would ask for this? And if I do need to fill out the S1, how do I obtain one? I researched this move to the death but requiring the S1 in our circumstances never cropped up.

Cheers
Paul

Alan PT

I'm guessing it's for the health service, so it's actually for your SNS number (aka Utente), not NISS (social security)?

Probably they are more used to dealing with people of state pension age and just automatically ask for the S1, you are correct in thinking that you will not get one of those (or need it)

Incidentally, if you plan to rent out your UK house long term, remember that you will potentially be building up a CGT liability when you sell: https://www.gov.uk/guidance/capital-...e-gain-or-loss

PJC61

Hi Alan,
Many thanks for your quick reply. You have confirmed my own thoughts on this and yes, it is probably to do with our health service user numbers, the application is going through now. I hate speaking to people on a subject I do not fully understand, especially solicitors!

Thanks also for the link to the capital gains tax info, this is something I am aware of but may bring the subject to the attention of other members reading this thread.
Cheers
Paul

Alan PT

Hah, yes, good plan, always helps to be armed with some info so that they don't try to bamboozle you

You'll also find that the "Brits in Portugal" Facebook page from the British Embassy has quite a few useful posts on this topic, if you want some more background info

ricko

If the sale occurs later than 5 years after leaving the UK, does the liability for CGT not cease?
Or has this rule been changed?

Alan PT

I think you are confusing the rule which potentially presents you with an additional (non-property) CGT bill if you return within 5 years
"Even though you may be deemed non-resident for income tax purposes, you are treated as temporarily non-resident for capital gains tax purposes for up to 5 years. Certain gains made during that time are taxed in the year you return to the UK if within five years." https://www.expertsforexpats.com/exp...ritish-expats/

But the CGT rules on property are specifically for non-residents, so will always apply

But as always, I'm just a random guy on the internet, so if you are in this situation, get professional advice. The UK rules are absurdly complicated - when we sold our house in the UK it was soon enough after moving that we were certain CGT did not apply, but it still took me several hours to complete the forms to confirm that to the UK tax office (who would have happily charged me large penalties for not completing the forms, even though no tax was due!)

SgtTroy

I would not be worried about UK tax on the sale as there are various allowances, etc, but I would be worried about PT tax on that sale, which would most likely be (significantly) higher.

Alan PT

Yes, definitely worth considering PT tax. Not relevant under NHR, but would be a concern once NHR had expired, though there are legitimate opportunities to avoid it by reinvestment

Listen Very Carefully

An S1 is only issued to persons in receipt of the UK State Pension or other benefits as you say .Many people who are in your position often self describe as being "retired" or are assumed to be retired by others when really you are not active economically and not eligible for an S1

SgtTroy

The "legitimate opportunities" apply if, inter alia, a) it is the current main residence, and in any case a dwelling on PT territory, and b) the gain is reinvested in another main residence either in PT, or within the EU (which obviously excludes the UK).

These opportunities do not apply to gains from former main residence(s), or to gains from second/third/etc homes

Alan PT

Ah, I was thinking of the opportunities to invest in pensions or insurance bonds, but I fear you are correct, that also only applies to properties within the EU. You can manipulate the main residence rules, but not the EU rule!

Brexit, the gift that keeps on giving...

ricko

Thanks for the clarification.
I looked at the link, and found the information very useful, but, as you said, the rules look like they can lead to horrible complications.

J00ls

Regarding the S1 form, this should be sent to you automatically from Overseas Pensions in UK shortly before you turn 65. If it doesn't arrive, chase them up (we had to). You will need to hand it in to your local Social Security Officer here in Pt (they will give you yet another form to fill in) in order to register entitlement to Portuguese healthcare here. Even if you intend to go private its still worth doing as back up. Make sure you take copies of your passport, residency, NIF, proof of address etc.

Red Eric

In view of the OP's stated situation and for the benefit of others who may read, eligibility for enrolment in the public health system here is not contingent upon being eligible for S1 cover. Anybody who is resident in PT is entitled to enrol in the public system, whether they are working, retired on a pension, or living off their savings - it's merely administrative procedures determining who bears the costs which makes the S1 of any significance.

Yes, if you're entitled to one you should definitely obtain it, for the benefit of the PT health service, which is thus able to recharge healthcare costs back to the UK or other relevant state. Anyone enrolling for the first time should be asked the right questions to determine whether the S1 would apply to them and be obliged to get it before being enrolled, but anyone already enrolled should obtain and register the S1 on reaching state pension age if they haven't got any pension from PT but have from the UK or from an EU etc member state.

Apologies for the pedantry but the difference between eligibility for use of the public health system and eligibility for S1 is an important distinction.

Listen Very Carefully

Nothing wrong with being a pedant because getting things right especiallyt at the beginning always pays dividends later