• Taxes

    Taxes

    Portuguese government offers tax-free retirement.

Taxes

Your pensions and investments have been hard-earned over a lifetime. It makes sense that you want to use the funds to its best advantage. We enable you to do that: If you choose to purchase one of our two-bedroomed villas, reside in Portugal for at least 183 days per year and have not been a resident in Portugal for tax purposes over the last 5 years.

There is no double taxation, you will pay 10% tax for the first 10 years of your residency in Portugal on your pension, on employment and self-employment income obtained abroad, provided certain conditions are satisfied.

This foreigners tax incentive, introduced with the backing of the European Commission, the European Central Bank and the IMF has been designed to allow middle to high income pensioners to choose Portugal as their retirement home.


Why this tax incentive?

The idea behind this incentive was to target two segments of society:

  • Highly skilled labour.
  • To encourage middle/upper class pensioners to retire to Portugal with the intent of encouraging Portuguese economic growth.

Almost everyone who becomes a fiscal resident in Portugal will pay 10% taxes on their pension. But there are certain exceptions such as citizens with residency in tax havens or countries like Sweden which withdrew from the tax convention with Portugal.

From the moment you become a Portuguese tax resident, it is up to the Portuguese government to tax your pension. For the first 10 years the Portuguese government will tax you 10% on your overall foreign income. You are exempt from inheritance taxes.

If you are part of a long list of high added value professionals, such as doctors, engineers, architects, Phd researchers, all your work generated income in Portugal will be taxed at a fixed rate of 20% income tax.

The system it is technically called the Tax Scheme for Non-Regular Residents. This means that it is only applied to those who have not been tax residents in Portugal during any period of the last 5 years.


Tax Scheme for Non-Regular Residents.

How to acquire the Portuguese tax residency status and for how long?

In order to benefit from this tax scheme, you need to:

  • Be registered in the Portuguese tax office as tax resident.
  • Live in Portugal for at least 183 consecutive days during any 12 months period.
  • Own a house during any part of that 12 month period so that it can be perceived that there is intent to reside in the country permanently.
  • Persons who have not been a Portuguese tax resident during the 5 years previous to the application.
  • Those who apply to be registered as a non-regular tax resident until the end of March of the following year in which they become a tax resident in Portugal.
  • You will benefit from this tax scheme for 10 consecutive years.
Procedure to acquire this tax resident status

In order to become part of this tax scheme, you need to do the following:

Obtain a tax office number in order to:

  • Open a bank account and to rent or own a house.
  • To gain the non-regular tax resident number.

Necessary documents required: Copy of passport; Power of Attorney for your lawyer and proof of residency in Portugal.

Portuguese postal address is obtained by:

  • Renting a house.
  • Procuring/buying a property.

Applying for non-regular tax residency:

  • Obtain Portuguese tax office number.
  • Get confirmation from your tax office confirming your income and official declaration testifying your tax residency for the last 5 years.
  • Proof of residency in your country of origin via utilities bills.

NOTE: The Portuguese government is currently taking 6 months to process and confirm the status of non-regular tax residents.

International Taxation

The non-regular tax resident main advantages are as follows:

  • You are considered to be a Portuguese tax payer.
  • You only pay 20% income tax on work developed in Portugal as long as it belongs to activities considered to be “high added value in scientific, artistic and/or technical areas”.
  • You are exempt from taxation on foreign income

We advise you to take further counsel in order to clarify your personal situation with the intend of obtaining the non-regular tax resident in Portugal. Consequently you should speak directly with our lawyers office which has wide knowledge of the Portuguese legislation and very extensive experience dealing with these procedures. They are expecting your contact.


Golden Visa Portugal

The Golden Visa Program in Portugal has proven to be one of the most popular schemes in Europe with investors attracted to its ease and flexibility to obtain, along with all the benefits it provides.

The visa program was launched in 2012 and has been promoted by the government as an investment in real estate, there are several ways to obtain the visa with the most popular being an investment of €500.000,00 into a freehold property in Portugal. The value of this investment is reduced by 20% to €400.000,00 when it is made in low density territory such as in our Municipality.

The visa allows you and your dependent family (Children & Parents) to gain a residency permit in Portugal for 12 months and is then renewed on a 2 yearly cycle.

For the purposes of renewing a residency permit, you may have to show that you have resided in Portuguese territory for a minimum period of 7 days, either consecutively or non-consecutively, during the first year, and 14 days in subsequent two year periods.

This visa will allow you to travel freely across Europe within the Schengen Zone.

The most attractive part of the visa is that after 5 years of title you can then apply for permanent residency within Portugal and after 6 years citizenship.

The basic requirements to qualify is the initial investment, a clean criminal record and the ability to spend a minimum days in Portugal each year. Without the need to reside in Portugal this visa has become the most attractive and popular option across Europe.

Once residency has been granted you will have the right to live, work and study anywhere within the European Union, once citizenship has been granted you will become a European citizen and will have the same rights of anyone in Portugal.


Investments eligible for the Portuguese Golden Visa

Property Acquisition
  • The acquisition of real estate with a value of 500 thousand Euros or more. The value of this investment is reduced by 20% to €400.000,00 when it is made in low density territory such as our Municipality.
  • The purchase of real estate with a global value greater than or equal to 350 thousand euros (in an area of urban rehabilitation, with buildings over 30 years old and the implementation of recovery works to the property purchased).
Capital Contributions
  • Transfer of capital worth 1 million Euros or more to a Portuguese bank (including investments in company stocks or shares).
  • Transfer of values with a global value greater than or equal to 500 thousand euros for the purchase of participation units in investment funds or risk capital aimed at the capitalisation of small and medium companies which, for this purpose, present the respective capitalisation plan which is deemed viable. 
  • The transfer of capital in values greater than or equal to 250 thousand Euros, applied to support artistic production, recovery or maintenance of cultural heritage.
  • Transfer of capital in values greater than or equal to 350 thousand Euros, applied to scientific and technological research activities.
Business
  • The creation of at least 10 jobs.
Benefits of the Portuguese Golden Visa
  • Travel freely in the EU within the Schengen Zone.
  • Live, work and study in Portugal.
  • Portuguese passport within 6 years.
  • Low physical annual presence requirement (7 days in the 1st year subsequent years 14 days per year).
  • Attractive taxation system.
  • Extended residence to family members.

Avenida do Atlântico Nº 16, 2º Andar - Escritório 11, 1990 - 019 Lisboa - Portugal
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