Portugal
The Portuguese tax and legal system is different from that in the UK and many other countries. Many people who have moved to Portugal or are planning to do so may inadvertently find it potentially quite expensive from a tax perspective, particularly if they are higher earners. What they often do not realise, however, is that they may be able to take advantage of Portuguese tax compliant opportunities to protect their assets from taxation in Portugal.
As with any wealth and estate planning, the starting point is to understand what the rules are and then establish if there are ways to minimise the personal impact of them and if you can use the rules to your benefit.
PORTUGUESE TAXES
From a tax perspective, the starting point is whether you are Portuguese resident or not. If you are a Portuguese tax resident or you will become one then, in common with most other countries, you will be liable to Portuguese income tax and capital gains tax on your worldwide income and gains. Portuguese inheritance tax may be payable on your Portuguese assets, although the immediate family is exempt in Portugal.
You may also still be liable to UK inheritance tax if you are a UK domicile. If both local and UK inheritances taxes are payable on the same assets, you will be able to credit the overseas taxes against the UK tax.
The use of trusts can be an effective means of reducing your tax liabilities in Portugal.
UK RESIDENTS WITH CAPITAL IN PORTUGAL
If you are not a Portuguese tax resident or have chosen not to become a tax resident of Portugal you will still be liable to income tax and capital gains tax in Portugal on your Portuguese assets. The same income or gains may also be taxable in the UK, with a credit for the Portuguese taxes paid.
For more information on Portuguese taxes CLICK HERE to download our free tax guide to Portugal.
Portuguese succession law decrees how your assets should devolve upon your death, protecting any children of the deceased rather than the spouse. However, these rules may not apply to you if you are not a Portuguese national, provided you have a Will valid under Portuguese law.
WHY CHOOSE BLEVINS FRANKS?
- We have offices and qualified advisers in both Portugal and in UK. This means we are able to provide initial and ongoing advice to help you reduce tax on your wealth and help you structure your assets in the most efficient manner, whether you are at the planning stages of moving to Portugal, or you are already living in Portugal, or if you are considering a return to the UK.
- Blevins Franks Financial Management Limited is authorised in the UK by the Financial Services Authority (FSA) for the conduct of investment and pension business. We are authorised to give advice in Portugal through the EU Insurance Mediation Directive (IMD) – we are a UK company with offices in Portugal. Our advisers in Portugal are professionally qualified.
- We have first hand and up to date knowledge of the ever changing Portuguese tax regulations, as well as the opportunities available to reduce your tax liabilities.
- We offer Trustee services through Blevins Franks Trustees Limited, which is based at our Head Office in Malta.
- We take a holistic approach to protecting your wealth as we are able to give you integrated advice covering your Portuguese assets, your UK assets and any assets you own elsewhere.
- We provide a personal, ongoing, customer focused service and do not treat our clients as account numbers.
- So far we have been providing trusted services for over 35 years. We are here to guide you and your wealth today; in the future as your circumstances and objectives change, and eventually to help your spouse/partner and family when they inherit your assets.
The tax rates, scope and reliefs may change. Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change. Tax information has been summarised; an individual must take personalised advice.
