This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.
Analytics

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.

Essential

Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet

Portuguese tax resident and sale of UK farmland

madexpat
Posts:3
Joined:Wed Aug 02, 2017 9:03 am
Portuguese tax resident and sale of UK farmland

Postby madexpat » Wed Aug 02, 2017 9:31 am

I am a Portuguese tax resident but British Citizen.
I inherited some farm land, in England, from my mother in 2000. Inheritance tax was paid on the estate at this time so there is a valuation of this land. The land has now been sold, it is still farm land and not building land. I know the CGT laws changed in 2015 for non resident UK tax payers so I may have a CGT liability on this although it is not residential.
My question is about the Portuguese CGT liability. I am aware there may be some to pay and I accept this. It is just that my tax advisor here has said that is should have been valued when I became tax resident in Portugal. This seems a little odd to me as who would know to do this and I can find nothing on the web to suggest that you have to do this with any property or land. All I can find is that anything bought/inherited after 1989 is subject to Portuguese CGT.
Hope someone can clarify this for me, thanks.

AGoodman
Posts:1745
Joined:Fri May 16, 2014 3:47 pm

Re: Portuguese tax resident and sale of UK farmland

Postby AGoodman » Wed Aug 02, 2017 10:40 am

I don't know about Portugal but there should not be any UK CGT to pay. Long term non-residents only pay CGT (actually NRCGT) on UK residential property.

madexpat
Posts:3
Joined:Wed Aug 02, 2017 9:03 am

Re: Portuguese tax resident and sale of UK farmland

Postby madexpat » Wed Aug 02, 2017 11:51 am

Thank you for that, I did see that on the HMRC's site.
Just hoping someone can help on the Portuguese side of this.

darthblingbling
Posts:698
Joined:Wed Aug 02, 2017 9:09 pm

Re: Portuguese tax resident and sale of UK farmland

Postby darthblingbling » Tue Aug 08, 2017 3:48 pm

Are you on the NHR scheme?

Potentially you could be exempt but I would seek local advice. If you're on the scheme then potentially any income in which the other country has the 'right' to tax via the double tax treaty may be exempt in Portugal.

Otherwise it's likely taxed in full on the usual Portuguese rules with no relief available as the UK does not tax.

madexpat
Posts:3
Joined:Wed Aug 02, 2017 9:03 am

Re: Portuguese tax resident and sale of UK farmland

Postby madexpat » Fri Aug 18, 2017 8:38 am

Sorry, missed the reply.
No I am not on the NHR scheme, I was here before that started.
I know I will have to pay CGT here and that is not the issue. The issue is and I can't find the answer to this is that my accountant is saying they will base the CGT on the value of the land when I became a resident, not on the value at inheritance in 2000. This was a probate value for inheritance tax purposes. Surely it would be the same as if I had bought the land myself and then sold it, the CGT would be based on the value that I bought it? Hope this makes sense. Thanks.


Return to “International Tax”