ricko

Thanks for the clarification.
On looking closer at the document, it says, for all these incomes:

are exempt if alternatively:
a) They are taxed by the source State/nation,

Does this not mean that they would have to be taxed in the UK to be exempt in Portugal?

Loafing Along

Check the phrasing because I believe the operative word is "could" but as a non-resident they should be taxed by the UK but will not be under double-taxation agreement.

RichardHenshall

I think that's the snag. Normally Capital Gains are taxed by the country of residence only except for real estate where they're taxed first in the country where the property is located and then taxed by the country of residence, with any relevant Double Taxation Treaty dealing with any overlap.

ricko

Quote:

Check the phrasing because I believe the operative word is "could" but as a non-resident they should be taxed by the UK but will not be under double-taxation agreement.

I cut and pasted the phrase from the document, so there was no "could"
suggested.


The phrase at the top appeared for all types of income mentioned, not just capital gains.
There were a few links in this part of the document. I suspect these gave qualifications and clarifications. However, all of the links went to documents that were only in Portuguese.

RichardHenshall

That's another snag!

Ukkram

DTA UK - Portugal. Article 13.4 States:

//4. Gains from the alienation of any property other than those mentioned in paragraphs (1)
and (2), shall be taxable only in the Contracting State of which the alienator is a resident.//

The word "property" mentioned here includes investment securities and is only taxable by Portugal. This made me think that the Capital Gains I make are exempt having NHR status. It is not and 28% flat rate is payable. The same rate as local citizens.

So if you are a Category E taxpayer then NHR will not apply. I still don't get it.

ricko

If Category E (Capital Income), means Bank Interest and Company Dividends, then are you saying that you would pay tax in both the UK and Portugal?

Pilou

No, these are tax exempt in Portugal under RNH.

Ukkram

Category E in my case is Capital Income from gains made in investments or Capital Gains Tax. The Dividends are withheld at source and capped by the DTA at 15%.

PT AT has billed me €11k for a gain I made when I switched from one company to another even though I have NHR status.
This is because the DTA states that Capital Gains are taxed in the country of residence ie in PT.

RichardHenshall

UK Bank Interest and UK Company Dividends are not generally subject to any withholding tax for non-residents. Does this mean that 'UK-sourced' income of this kind is therefore taxed in Portugal, even with NHR?

Ukkram

I am aware that the UK tax on Dividends and Interest are taxed differently to South Africa where I get my income from but Capital Gains are taxed only by Portugal whether it is earned in the UK or SA. Both DTA's are the same on this matter as are most western countries.

UK uses the RESIDENCE clause in the DTA as shown in post 156. So having NHR will not apply.

Pilou

Thanks a lot for your detailed info concerning of how to register for the RNH.

To register at the tax authorities in order to obtain a password, can you remember how to do this online? I cannot find the right category. Or can I go to financas?

Thanks

Loafing Along

This link :
https://www.portaldasfinancas.gov.pt/pt/home.action

Top line : Cidadaos - click

At the top of new page "É a 1º vez ..... in small type in that box is "registrar me" in blue, click will lead you to the form to fill out

Pilou

Many thanks for your quick response!

JohnsonN

Hello everyone and thanks for sharing your experience!
Just received my residency in Portugal, visited Financas to consult reg to NHR, but didn't get any answer. Visited 2 different lawyers and got different answers. Please let me know if you know anything about my question
The financial situation is like this:
1. I have shares of one American company and get dividends every quarter.
Will it be an exemption under NHR?
2. I am planning to sell these shares in the future but unsure about taxes also.
Any ideas?