# Taxation advice to a British employee working in Portugal



## CoastalB (Jul 11, 2011)

With regard to moving to Portugal and working there, can anyone point me in the right direction with regard to accessing accurate tax advice?

My situation is that I shall remain as an employee of a British-based employer, but be working from home, whereby my 'home' will be in Portugal, most probably on the Silver Coast.

I have read snippets here and there relating to a 10-year tax exemption put in place by the Portuguese authorities

This sounds too good to be true!

Keeping in mind that Portugal already has a double taxation treaty in place with the UK, does this mean I could opt out of paying tax in the UK altogether?

My wife has had a brief discussion with a couple of Portuguese accountants who have not heard of the non-habitual residents tax exemption.

Can anyone point me in the right direction with regard to finding an appropriate person/company in Portugal who could clarify my position and options?

Many thanks in advance.


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## canoeman (Mar 3, 2011)

Living in one EU country and working in another is generally covered as a Cross Border Worker, the normal tax and NI situation is that you pay tax and NI in your country of employment.
That country then supplies necessary forms (S1) for your country of Residence's Social Security.
If you can fit into this category it is more beneficial and far easier for and your family. It simplifies the Portuguese Social Security contributions and taxation. 

As a Portuguese Resident you are required to file a yearly return (tax year is Jan-Dec) and declare earnings and tax paid outside Portugal, *if* you did have a Portuguese Tax Liability then UK tax paid is offset.

You retain and add to your UK State pension rights.

I don't believe that the 10 yr tax exemption applies to you and whether the scheme will survive the austerity measures.
There's been a recommendation for an accountant on a post by tonyD? not the Silver Coast but seems familiar with Expat finances.
EU-Working in one country and living in another: rights and conditions-Your Europe


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## Toby D (Oct 28, 2011)

CoastalB said:


> With regard to moving to Portugal and working there, can anyone point me in the right direction with regard to accessing accurate tax advice?
> 
> My situation is that I shall remain as an employee of a British-based employer, but be working from home, whereby my 'home' will be in Portugal, most probably on the Silver Coast.
> 
> ...


I was pointer to Tax Solutions - Accounting in the Algarve. They are from the Algarve but may be able to help. Thay have been great for us!


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## notlongnow (May 21, 2009)

We use Algarve Tax Solutions and are very happy with them...perhaps it was me who recommended them on another thread.

My wife is in an identical situation. If you plan to live here permanently, you must get residency after 3 months. If you are here more than 183 days in one year, you are then considered fiscally resident. HMRC gave her a tax code of "NT," - her employer deducts no UK tax, but she declares all of her income here and pays tax once per year.

Social security has been more tricky. As stated in a post above, she should be able to get a workers S1...but two years on, HMRC still haven't given one to her, and won't until Portugal contact them. In the meantime, no mechanism exists for her to pay PT social security as she isn't self employed here, not does she work for a PT company. She therefore has no state medical cover right now (so we have a private policy).

The rules are actually quite clear, how each government employee interprets them in both countries is where it gets tricky.

Finally, an average UK salary is quite a high salary in PT terms and, in our case, our tax liability is a fair bit higher than it was in England - we call it "the sunshine tax."


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