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Where Taxpayers and Advisers Meet

Working for a British company while maintaining residency in Portugal

sammunro100
Posts:1
Joined:Sat Nov 21, 2020 7:42 pm
Working for a British company while maintaining residency in Portugal

Postby sammunro100 » Sat Nov 21, 2020 7:56 pm

Good evening, I wrote a relatively hefty reddit post about moving to Portugal in the coming months - https://www.reddit.com/r/IWantOut/comments/jyg0j1/iwantout_25m_united_kingdom_portugal/

They key parts relating to this forum however reside around question 3 near the bottom of the post I shall reiterate here though as well.

Question/Problem three - Working for a British company

So this part I have some information but definitely not all and would appreciate the blanks being filled in, shall touch on what I feel like I'm missing in a minute.

# 1.4 - https://www.globalcitizensolutions.com/nhr-portugal-tax-regime/ (As a software engineer I fulfil the criteria here for potential elibility)

# 1.5 - https://www.pwc.pt/pt/fiscalidade/2017/pwc-non-habitual-tax-residents.pdf

# 1.6 - https://www.gov.uk/tax-uk-income-live-abroad/taxed-twice


# 1.4 Excerpt


Requirements

In order to qualify for the NHR regime, applicants must fulfill the following requirements:

Have the right to reside in Portugal either through being an EU/EEA/Swiss citizen, or through schemes such as the Golden Visa program

AND

Not have been a Portuguese tax resident in the five years prior to taking up residence in Portugal

To maintain a residency status in Portugal, the individual must

Have a place of abode in Portugal on the 31st of December of that year. This home must be available in a way that may lead to the supposition of an intention to keep and occupy it as a habitual home.


......

What if my income is paid in another country?

If your income is paid in a country which has a double taxation agreement with Portugal, you will be exempt from paying any tax in Portugal.



#1.5 - Excerpt

To qualify as non-habitual tax resident*, an individual must be considered as tax resident in Portugal in a certain year and he/she cannot have been tax resident in the previous 5 years.*

In general terms, an individual is deemed to be tax resident in Portugal if one of the following conditions is met:

• more than 183 days are spent in Portugal in any 12-month period starting or ending in the fiscal year concerned; or

• having spent less than 183 days in Portugal, an individual maintains a residence suggesting being a habitual residence in Portugal in any period within the above 12-month.



#1.6 - Excerpt


You may not have to pay twice if the country you’re resident in has a ‘double-taxation agreement’ with the UK. Depending on the agreement, you can apply for either:

partial or full relief before you’ve been taxed

a refund after you’ve been taxed



Right with the above information laid out firstly lets lay out what I'm relatively unsure about, I pay my tax through a PAYe system/HMRC pretty standard as far as I'm aware (I have very little knowledge of the taxation systems so apologies if this wrong or painfully obvious) , now I will need to notify HMRC that I'm leaving the country on a permanant basis.

Will this have any implications towards my employer, and do I need to tell my employer that I'm doing this on a legal basis **?

Or will it all simply remain the same, as my statutory-residence will reside within the UK until the next tax year rolls around following this source - https://www.expertsforexpats.com/expat-tax/statutory-residence-test/

* * Side note - I'm reluctant to inform my employer of this decision to leave the UK as I'm almost certain they wouldn't support it, despite working fully remotely anyway...., with the intention of seeing how long I can slip under the radar while I search for another employer that will support full remote working abroad. I'm not particulary fussed if they do find out and give me the sack though, just as long as I can obtain the residency in Portugal first.


Now the part I'm really not sure about although I think it might be covered by the nhr-portugal-tax-regime is letting the Portugese officials know of my employement status and paying tax in both countries with the intention of claiming back the tax relief following scheme taxed-twice. How will this work on the whole will they work in conjunction with HRMC (I'm assuming not), or will I need to be declaring my income coming in abroad ect, or do I not need to do anything if my application to nhr-portugal-tax-regime is succesful and I'm obtaining my income from abroad - Essentially I'm unsure whether I'll even get taxed-twice following the excerpt from # 1.4

What if my income is paid in another country?

If your income is paid in a country which has a double taxation agreement with Portugal, you will be exempt from paying any tax in Portugal.



Any guidance around this or legal aspects that I've several overlooked will be greatly appreciated, I am also planning on speaking to a tax specialist about this, just to get as clear a picture as possible currently planning using Dennis Accounts, but any better reccomendations for this particular situation would be more than welcomed!

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