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Tax Guide Portugal

Tax Guide Portugal

Tax Guide Portugal

Tax guide Portugal is searched on average 300 times a month via the most popular search engine “Google” & a further 100 times via Yahoo / Bing popular search engines. This is why we have provided the below article on tax guide Portugal.

UK nationals that currently reside in the U.K or are planning on moving to Portugal, make you review your financial planning as this is very important. With your life in Portugal you should contact experts with regard to the tax efficiency and how your estate planning, investment strategies and pensions can work most favourably for you
Once you’re resident in Portugal, you could potentially pay:

  • Income tax of up to 48%
  • A ‘solidarity tax’ of 2.5% or 5% for higher incomes
  • 28% on interest income
  • Tax on capital gains when selling property and investments
  • Annual wealth tax of up to 1% on property interests worth over €600,000

Non-habitual residents known as NHR schemes for their first 10 years in the country give special benefits with regard to tax benefits. If you are employed in Portugal with a “high value” activity it will also offer a reasonably lower tax income rate of 20%.

UK pensions in Portugal

Expatriates retiring to Portugal can enjoy significant tax benefits on UK pension income.

Through the UK/Portugal tax agreement, most UK pensions are taxable only in Portugal. For non-habitual residents (NHR), this can mean tax-free pension income for their first ten years in the country. For others, British pensions are taxable at the Portuguese income tax rates up to 48%, although it’s possible to receive up to 85% tax-free under certain conditions.

Many expatriates prefer to transfer their UK pension to a Qualifying Recognised Overseas Pension Scheme (QROPS) to unlock tax-compliant opportunities in Portugal.

Callaghan Financial Services can advise you on the pros and cons of all your pension options as well as the local tax implications, so you can make a fully informed decision on the best solution for you.

This article is provided as a guideline and we recommend that you seek specialist tax advice. Tax rules change and this article is published only as a guideline.