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Where Taxpayers and Advisers Meet

Income Tax and VAT when moving abroad

jordicx
Posts:1
Joined:Sat Feb 06, 2021 4:48 pm
Income Tax and VAT when moving abroad

Postby jordicx » Sat Feb 06, 2021 5:22 pm

Good afternoon,

I'm planning to move back to my country soon and would like to understand how I will have to pay my taxes.
I have been living in the UK for the last 10 years and besides of my everyday job I started an online business in February, 2020. I am registered for Self Assessment for two years and as my turnover passed the £85k threshold, I also registered for VAT. About my business: I sell various printed goods online that are printed in the UK and also being distributed from an UK based printing/processing centre. 90% of my customers are from the UK as well. I operate as a Sole Trader and my business has an UK correspondence address of course, mainly for return purposes.

As I'm planning to leave the UK and move back to my country soon, I would like to find out about the following:

1. The Income Tax. This part looks quite straightforward and if I understand it right after I'll spend more than 183 days in my country (Portugal) I will have to pay Income Tax on my worldwide income there. To avoid being taxed twice I will have to tell HMRC as soon as I'm leaving the UK and become as a resident "again" in my home country? Not sure of that matters but I'm planning to relocate in April, when the UK tax year ends (in Portugal it is from January to December).

2. What I understand far less though is the matter of VAT. At the moment of course, I submit my quarterly returns in the UK as everything (my residency, the business, all my income) is here. However if I will be a resident in Portugal again, will I have to pay my Income Tax there but still submit the VAT in the UK? I apologise if the question is lame but I really don't understand this part at the moment.
Also, is it possible (legal) at all to live in Portugal and run a business in the UK as a Sole Trader?

In advance, thank you very much for your help.

Best regards,
Jordi

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