ABOUT THE REGIME
The Portuguese Non-Habitual Residency status enables those who become tax resident in Portugal, and are accepted as NHR, the opportunity to receive qualifying income tax free both in Portugal and in the country of source of the income.
The NHR regime represents a major step forward in making Portugal a tax free jurisdiction for individuals in receipt of qualifying non-resident income.
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Owners of holiday rental properties face Capital Gains Tax blow Two news items relating to the Alojamento Local (AL) registration system for those property owners involved in short-term lettings to tourists further have reduced the chances of anyone registering without being forced to.
Owners who have their AL licence and who later remove their property from the scheme, for whatever reason, then are liable to pay capital gains tax, whether they are selling their property or not.
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The Central Register of the Effective Beneficiary (RCBE) consists of a database with accurate and up-to-date information about the persons who, indirectly or through a third party, have ownership or effective control of established entities in Portugal.
Subject to the RCBE are: (a) associations, cooperatives, foundations, civil and commercial companies, which conduct activities or practice a legal act or business in Portugal, and require a fiscal identification number (NIF); (b) representation of international legal persons or of foreign law carrying out an activity in Portugal.
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Currently there are approximately 800,000 independent workers registered in Portugal. Being your own boss has its advantages. However, you need to pay careful attention since the contributions and tax payments are made by you, rather than by a company.
In recent years, the self-employed have gained more and more rights. Nowadays, as occurs with salaried employees, these workers have achieved entitlement to protection in many situations, such as parenting, illness or unemployment.
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CGT: Older Properties and Unauthorised Improvements Many property owners who acquired their homes in Portugal in years gone by face a common dilemma: they bought at a time when real estate was dirt cheap. These houses were often primitive and in poor condition, requiring substantial renovations.
In those days, it was common practice to do the work and worry about the formalities later: no building permits, no formal plans, no invoices issued or kept.
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As a relatively new tax, it is not surprising that many have been caught unaware of their liability to pay AIMI and, more importantly, how they can avoid the disturbing consequences.
The additional assessment to IMI (Adicional Imposto Municipal Imobiliário) is sending shock waves to individuals and company owners who unwittingly find themselves under the weight of this added fiscal obligation.
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AL- Holiday Rental Licence procedure explained by afpop With the kind permission of afpop, the below information about Alojamento Local - short-term accommodation for tourists - normally is available only to afpop Members but is reproduced to show non-members the type of detailed information that is available.
Afpop’s Information Bulletin system is a comprehensive source of information on a wide ranging list of subjects, from car importation and setting up a bank account, to Wills, IRS payments and includes sections on motoring, health, property rental and purchasing, inheritance planning and many more.
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New Social Security contributory scheme for independent workers The revamped Social Security contributory plan for sole traders has been passed into law. Under the new regime, the deductions applicable to the self-employed will be based on the average income of the previous trimester, rather than the preceding year. The first declaration under the new rules will take place in January 2019, based on the earnings of the last quarter of 2018.
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New ID cards – a digital revolution The Portuguese government is launching a new citizenship card for registered foreigners in Portugal, as part of the ‘Simplex + 2018’ programme. The aim is to streamline administration of all foreign citizens and reduce much of the country’s bureaucracy. The Ministry announced that the new card will be issued in the final quarter of 2019.
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