Portugal Tax free?

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Redshoes

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I was in Portugal recently and while talking to friends they said that Portugal has a special agreement with EU ( an agreement designed to help Portugal's economy, it is a very poor country) where if you live in the counrtry for 183 days and apply for residency then you can live tax free for 10 years,.i.e no tax on your pension or investments for 10years. The programme is designed for retirees but working people are also are taxed at a lower rate There are some exclusions for example, civil servants cannot take advantage of this. Applying for residency in Portugal doe not affect your residency in Ireland in any way. I think its very interesting but the only downside for me is Portugal's weather, it's hot, has blue skies and very little rain.
 
i presume "in the country" means in the countryside hardly in the cities like lisbon which is already a highly desirable place to live and becoming a big draw for the high tech industry , and booming property prices. Its the countryside in portugal that is depressed, the cities are doing very well.
There was a scheme for non EU nationals to invest 500k or something in portugal a decade ago and get portuguese passport, alot of russians availed of this.
 
Redshoes said:
I was in Portugal recently and while talking to friends they said that Portugal has a special agreement with EU ( an agreement designed to help Portugal's economy, it is a very poor country) where if you live in the counrtry for 183 days and apply for residency then you can live tax free for 10 years,.i.e no tax on your pension or investments for 10years. The programme is designed for retirees but working people are also are taxed at a lower rate There are some exclusions for example, civil servants cannot take advantage of this. Applying for residency in Portugal doe not affect your residency in Ireland in any way. I think its very interesting but the only downside for me is Portugal's weather, it's hot, has blue skies and very little rain.
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Revenue has curtailed this scheme in the past few years to the point that it is no longer feasible.
 
Slim said:
Revenue has curtailed this scheme in the past few years to the point that it is no longer feasible.
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Do you have any reference for this?

I dont understand how Revenue could curtail a Portuguese scheme? Presumably when you become non-domiciled, the reach of Revenue is different to those who are domiciled and resident.
 
Apart from the Revenue ARF thing above, this Portuguese wheeze is well known internationaly and accounts for a lot of superstars living there ... and then movign on. Madonna and a certain Irish actor of German extraction is also living there, I believe.

I don't see any problem with a coutnry exercising their own tax soverignity in ths manner. I do see a problem with a certain entrepreneur moving his tradeshow to Portugal and then lambasting his own country for tax avoidance schemes and worse.
 
It’s fairly plain vanilla stuff to be honest.

Move to Portugal and for 10 years your pension or dividend income is tax-free.

N/A for ARFs or public sector pensions.

Although the ARF point is still being fought in the Courts. Primary argument being around whether an ARF is a pension or not as defined in tax treaties.
 
Portugal is well publicised, the article makes reference to France & Spain as well as having similar benefits, does anyone know the particulars for either / both of these countries?
 
Surely if I decide to live in a country like Portugal, for a specified no of days a year, that make me a non resident of Ireland, it has no consequence for me in a tax sense from Irish revenue? Is it true that Cyprus and possibly Portugal only tax pensioners from other countries at 5% if they become resident there?
 
Suggest you read up about "ordinarily resident" for tax purposes, and also about withholding taxes, you might not like what you find out though!
 
Ordinary residence isn’t a major deal though. The Treaty generally provides an out, and in any event it’s only a three year gig.
 
I dont see the problem here. Theres plenty of Irish people moved and retired to Portugal.
With-holding tax - move your holdings, DVF... its a simple process.
 
I was speaking to a pension adviser who recently helped a client set something up involving Portugal and Malta. If I had to guess, I'd say the pension was transferred before retirement to Malta, as you can drawdown a 30% lump-sum tax-free there. I'd imagine it also side-steps the problem of Irish tax being applied at source because the pension is now housed in Malta and they don't have this taxation fudge like Revenue are trying by calling an ARF "capital".

It's amusing that Revenue are trying to clamp down on Portgual as a tax-haven while simultaneously being reputedly the largest tax-haven in the world for US multinationals.
 
If an Irish resident and domiciled person sold their Irish LTD they will have to pay CGT on this sale.

If they live in Portugal for a period of time they wont pay this CGT liability?

What about remittance of the funds back to Ireland upon relocation back to Ireland - would a tax liability arise?
 
An Irish person wouldn’t typically sell a company though; their holding company would, where no CGT arises.

Historically, that person would then leave Ireland and take the proceeds out of the holding company by way of a tax-free dividend.
 
Slim said:
Revenue has curtailed this scheme in the past few years to the point that it is no longer feasible.
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That is absolutely not true!! However Will put a deadline on applications for the tax free programme in 2020, however if you apply before the deadline you can take advantage of the 10 years tax free status. Consult a Portugues tax accountant or solicitor and they will confirm.
 
joe sod said:
i presume "in the country" means in the countryside hardly in the cities like lisbon which is already a highly desirable place to live and becoming a big draw for the high tech industry , and booming property prices. Its the countryside in portugal that is depressed, the cities are doing very well.
There was a scheme for non EU nationals to invest 500k or something in portugal a decade ago and get portuguese passport, alot of russians availed of this.
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One of the reasons why Lisbon is popular with young foreign workers is that they can work for whatever global company they are employed with live in Lisbon and pay 15% tax for 10 years. Under the tax free programme you can live anywhere in Portugal.
 
I have been told that France has a very high rate of income tax on earning and pension in France. In the Algarve, especial Eastern Algarve, the French are retiring there in droves and buying property, so are the Swedish, in order to take advantage of the 10 year tax free status. The Swedish Statsminister is unhappy and wanting to change the tax laws in Sweden so pension is taxed at source and not taxed at the zero rate in Portugal, but nothing has changed yet.
 
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