Portugal, like many countries, has its quirks when it comes to taxation. But there are a few principles that always hold good if you want minimal stress with the tax authorities. These are your red tape red lines.
Bureaucracy in Portugal can be challenging. The worst thing is the lack of consistency, as experiences with government officials often seem to vary considerably from place to place. When you look for advice from Portugal expat forums, you’ll find people in one town have had to follow a completely different procedure (and provide different documentation) to those in another town, to accomplish the same thing. This includes things like signing up with a doctor’s surgery or registering for self-employment.
Official business can take place at a glacial pace – accept it. It’s just not done to get too impatient about such things
But you can make it easier for yourself, as some principles hold good throughout Portugal. With this in mind, this article presents five red-tape tips, particularly when dealing with your tax affairs.
1. Learn to use the online services
Portugal’s online government services are highly sophisticated, with everyone from the Finanças (tax office) to the Segurança Social (social security department) providing a fully-featured online portal to help you conduct your official affairs.
It’s well worth learning how to use these services in detail to help you keep on top of everything. Often you can find out information (such as the figure for your annual tax bill) far quicker online than by waiting for an official document to arrive.
2. Choose your accountant carefully
The quality of service from accountants in Portugal can vary significantly. Sometimes accountants may not truly understand the complexities of taxation for expats, but will try to take on the work anyway, resulting in bad advice and stress for the customer.
It’s usually best to go with an accountant on a recommendation, but always ensure they fully understand your personal situation. The cost of a good accountant usually pays for itself in the money you save on your tax bills.
3. Rely on facts, not wishful thinking
There’s a common misconception that expats somehow get to choose where they’re tax resident. The general rule is that if you spend more than 183 days per year in Portugal, you are tax resident there, and liable to pay tax there on your worldwide income.
If you are ready to buy in Portugal, you’ll have a few financial matters to sort out. For advice on currency, download the Property Buyer’s Guide to Currency.
Obviously, you’ll need to check your exact situation with an expert, but be wary of misinformation – a lot of which can come from other expats who are trying to interpret the rules in a way that’s beneficial for them personally.
4. Be patient
Some official business in Portugal takes place at a glacial pace – accept it. It’s just not done to get too impatient about such things. Ranting and complaining in a Portuguese government department will not makes things happen any faster!
If you accept that certain dealings will take time, and try to enjoy every small step as a triumph, you will find your life is much less stressful.
5. Keep documents handy
Portugal is far from being a paperless society when it comes to bureaucratic processes. Visits to the Finanças or town hall often require and generate a large amount of documentation. As well as keeping all of this for future reference, it makes sense to take it with you whenever you’re trying to achieve something. Otherwise you can be sure that the one document you left at home will be the one you need.
The Portugal Buying Guide is designed to support you through each stage of buying property in Portugal, providing relevant, up-to-date information and tips from Portugal property experts and expats who have been through the process themselves. It helps you to: