Seven Misconceptions About Portugal’s NHR Tax Program

[@kryptoprawnkrow3084]

Great video Andrew! I can confirm what you are saying. It does indeed take plenty of work, more than I expected. In order to obtain the NHR you need to get quite a few documents. And to get each of those documents, you need even more documents, so the effort and time consumed grows exponentially. Something as simple as opening a bank account without having portuguese income can be difficult. The bank kept rejecting my documents with poor excuses and refusing to provide me an account... took me several trips. Also most landlords like to get cash in hand rent without a contract, which makes it extremely hard for you to prove your residence, in which case you need to find locals willing to testify that you are a resident in the address, get their signatures, book an appointment at the local council etc... Although I do not regret it, I would mainly recommend it to those who really want to move in and settle in the country.

[@TheMountainBeyondTheWoods]

The bureaucracy is indeed bad, but not worse than most other countries.

[@erikberg849]

If you are going to be an expat, check Andrew's videos. He is the only one I have found who gets things right.

[@julioalmeida4645]

This is great for Portugal. Even though natural citizens get pushed out of the good places (e.g Lisbon, Porto) because of the rising costs of the real estate. Many of us are going to Georgia, which is creating a remote bourgeoisie class that pays a 1% tax rate on the great IT salaries. Most of us are spending 6 months in Portugal with the ability to avoid social security and IRS and paying for a house in Tbilisi in less than a year.

[@Pablo-or1jo]

I went there and considered it and residency before Brexit... but without it being very clear, I came to the conclusion that capital gains on stock trading was not exempt, and subject to 28% flat rate. Since that is my income to some extent I decided not to invest the time and effort there. Nice country though, although frustrating when you wanted to get things done efficiently, I hope to visit again as a tourist...

[@gerardclement3095]

Hi Pablo, thanks for the info. When you are talking about stock trading, is it stocks traded in a Portuguese stock exchange or worldwide like Toronto since I am from Canada. I have also read that capital gains outside Portugal were not taxable in Portugal. I never found any information published by the government of Portugal that would give clear directions. Any websites to suggest.

[@marvingiehl]

@@gerardclement3095 same question, but for me specified to option trading.

[@marciomatos1975]

If you choose a Portuguese trader, you do not pay taxes.

[@cliffm6566]

These are all pretty basic issues to anyone who knows anything about the NHR program. Of course it's not a 0 tax scheme and does take some personal planning and education and assistance from qualified professional. But for some being able to cut your taxes on foreign pension income for example from 35-40% in Canada or US to 10% is a good thing. There are other exemptions for foreign dividends. As far as residency visas the D7 is a good option as the "Golden visa" requires a 1/2 million Euro investment.

[@flyheli]

There were also some recent changes in the Golden Visa... not valid anymore for Lisbon & Porto starting 2022 I believe.

[@craigwelch4597]

I’m a US retiree who would be living off a pretty good government/public sector pension. I just read that the new NHR rule of a 10% flat ONLY applies to private pensions! Yikes! I guess the devil is truly in the details. The term pensions is always used loosely, suggesting private & public pensions. As I’m re-reading the NHR, it doesn’t apply to me! I would be taxed by USA & Portugal. I guess now the whole double-taxation thing kicks in. But I think I would get beat-up by the Portugal side of the tax obligation. Ouch! The devil is in the details, guys!! Read the fine print.

[@cliffm6566]

@@craigwelch4597 yes my interest in Portugal has evaporated though it seems my pension income would apply for the reduction. There are other less attractive aspects to living and relocating to Portugal. The EU for example exerts enormous pressure on the govt to raise taxes and standardize high cost programs that are not affordable to Portugal. The cost of living is rising fast

[@erikberg849]

I just went to the tax office and filled out the form for the NHR You may have to go in two or three times and, of course, everything is in Portuguese. I am a Portuguese resident. I use an accountant for my taxes in Portugal. A lot of accounts speak English and their charges are reasonable. I always fine in the US, too.

[@PinkieSmith]

The transcript to this video is HILARIOUS! 😂

[@sharkmiguel]

Portugal is a very bad investment for anyone minimally interested in owning private property. Local government now has the power to seize unoccupied housing and use it as social housing. And don’t be enticed by what initially appears to be low taxes, it’s only on a temporary basis, a decade at most.

[@braaap2943]

the great combination of socialist and american "progressive" politics. Got to love it

[@sebas8225]

Still Better than most Western Europe. A word of warning though, stay out of the Courts as much as possible, there´s a lot of local corruption.

[@julioalmeida4645]

Guys, just move to Georgia. Let portugal be a the new Paris where the wealthy dwell and just move to Georgia.

[@sebas8225]

@@julioalmeida4645 How are the Courts in Georgia?

[@julioalmeida4645]

@@sebas8225 Dont know enough to tell you.

[@jeffb.140]

Portugal also considers a ridiculous amount of countries as 'tax havens' (basically any country that isn't socialist) .. And taxes business transactions with them extremely high

[@wolfgangwust5883]

Can you please be more specific on that subject? Is there a list online? Thank you.

[@wolfgangwust5883]

@@rubensnogueira5838 Obrigado, Rubens. To whom it may concern: Google "Portugal's list of tax havens". Happy to miss Georgia on the list ;-)

[@amir5593]

@@wolfgangwust5883 Shouldn't be because Georgia taxes at 5 percent and if you don't plan in a right way it will be 20 percent.

[@garthdrummond]

If you are resident in what Portugal considers a 'tax haven', you pay 35% withholding tax on any money earned in Portugal, which makes investing less attractive than other locations.

[@amir5593]

@@garthdrummond Couldn't agree more. Portugal attitude toward tax havens is an aggressive one.

[@rubensnogueira5838]

Does anyone have experience with Portugal's CFC rules? I still could not find clear info about corporate and dividend tax exemption for business owners who live in Portugal under NHR.. That's the last pending issue in my plan.

[@HaiderAli-uj1kv]

Hi Ruben, were you able to find more info on this?

[@DiogoF.]

Many Chinese in particular and some Brazilians took advantage of the Golden Visa first. Now, Lisbon is a mix of cultures and ethnicities from Bangladesh to Nepal, Brazil to Cape Verde to the French and English residents. The city is full of tourists from all over the world and the airport is bustling. But Portugal has some problems in the way the medium citizen is treated.

[@dynamicsoulslayer]

Have been looking at real estate in Cascais but im worried about a language barrier especially for my children with education etc.

[@DiogoF.]

@@dynamicsoulslayer That would really not be the case, even if you start learning Portuguese when you would try to speak it people would instantly turn to English because they noticed the accent.

[@dynamicsoulslayer]

@@DiogoF. That is good news thank you so much.

[@tylers.2596]

Nice icon above the fireplace.

[@d4a]

Any definitive information on how KZbin income for an individual is treated in Portugal? It's royalties under the KZbin terms and conditions. I asked a few agencies and lawyers and I'm getting conflicting information as some claim Portuguese law treats KZbin income as business income or self employment income which is taxed at 20%. Anyone have any experience or concrete info on this?

[@TonyAube]

So if I work remotely in Portugal on the NHR I pay 20% taxes?

[@mobilesam7i]

yes, exactly

[@mquintal88]

plus ~15% social security

[@kookia213]

Seen in the comments lots of folks talking about "stay away from the courts". can anyone explain?. and... why would someone need to go to court?

[@amir5593]

Informative 🙏

[@Je.rone_]

I’d check out Portugal

[@928gto]

What about Morocco

[@dalethepalemale6855]

Would I be eligible as a remote worker?

[@milenailic1437]

You are in Belgrade again, so how is yor life here?! :)

[@cookmaster3626]

As a US citizen if i get a D7 visa ( no intent to work / run a business in Portugal /USA) and convert it to NHR status. I have no business income and living on Passive income from US from my pension/401k/dividend etc. i believe all of these passive income is taxable under NHR @ 10% rate. Portugal has a dual taxation treaty with US. If the Portugal Income tax ends up higher than Tax owed in US, will i have to pay the higher of the 2 country's taxes?. Thanks

[@rubensnogueira5838]

One detail: if anyone goes to Portugal shortly and, just for fun, gets a NIF, that moment is counted towards the 5-years requirement - that would force that person to apply for the NHR until March next year or miss it entirely. That's what I heard/read somewhere, so check it out before you make that move.

[@tupisamba211]

I did this about 3 years ago (got the NIF "for fun" as a tourist) but didn't stay. Are you saying that is bad for me if I wanted to do NHR? As far as I understand, you have to stay 5 years outside of Portugal, meaning I would have to stay another 2 years outside.

[@rubensnogueira5838]

@@tupisamba211 it's hard to find that specific info in the internet and a tax advisor would be the way to go. If it's correct, you were considered a tax resident 3 years ago (you needed a tax representative in order to get your NIF). You have to wait at least 2 more years in order to start an eligible tax residence under NHR.

[@rubensnogueira5838]

@@tupisamba211 I almost did it last year, it could have become my ruin. Anyway, be sure that you gave an foreign address to the tax authority, otherwise you are still considered a tax resident...

[@cliffoncrypto3082]

False, you have to register for TAX status. Ive just done it. The date only ticks from that date! Not the NIF registration. I had my Nif 2 years prior to my TAX status registration. My 10 years has just started.

[@tupisamba211]

@@cliffoncrypto3082 That's good news, Cliff. Tax status, I'm not sure I'm familiar with this step. Is this "abrir atividades" (proof of starting business activity)? or is it applying for NISS (social security number)? or something else...EDIT: After thinking for a moment, you might mean register for tax status for NHR, correct?

[@MrSmith-on1qz]

I want to see more analysis by the nomad dad about the decline of the west

[@maxflight777]

I agree ! I thoroughly enjoyed listening to Andrew’s father. What a fabulous man.

[@ouardizekeriya6110]

lets see.

[@TheSimArchitect]

It is NOT zero tax. You only get to not pay double tax if you already paid tax elsewhere. If you didn't have tax witheld at source, you will have to pay tax. This is very misleading because depending where you come from this tax program will be moot as you are allowed to deduct those taxes anyways, which could be larger than Portuguese ones, depending where you come from and the characteristics of your income. Nobody mentions this essential piece of information and I wonder why. Besides that Portugal has VERY high taxes and their inhabitable real estate is currently matching expensive peers up north, which will sometimes treat the wealthy much better on that aspect (no capital gains in The Netherlands, for example, just be smart about your investments and you'll pay a flat fee on your invested and liquid assets). I am still looking for the possibility of moving there because I am a citizen and I speak the language, but I would surely NOT move there otherwise because most "normal" Portuguese people don't speak English, for example (unless you are using their touristic infrastructure). People move to southern European countries with all this romanticizing they'll find happiness there because of what they see on movies or experience as tourists. My advice would be to actually do your own research on your own circumstances and priorities versus their bureaucracy and, if you feel it's a good match, yet, rent an airbnb at your destination for at least three months (half year of possible) and live there like a local. Try to use their services, visit their doctors, get a medical checkup, maybe walk around and see how you are treated when you visit a local bakery, when you use public services (if you have nothing to do there, go just to ask for information to see how short or long you have to wait and how well or badly you are treated). That's my advice, anyways. I hope it's useful. I am still considering it, but I admit all the places I currently have in mind, as a non wealthy person, suck badly somehow. Otherwise I would be there already.

[@CaueMS]

Turn on the captions and have a laugh

[@alecmajchrzak6511]

What a boring place to go and live. No thanx

[@TheMountainBeyondTheWoods]

You're crazy.

[@princereddy4887]

Algarve is amazing