Capital Gains & Lawyers

Share experience regarding ownership of property and/or living in Portugal.

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Capital Gains & Lawyers

Postby steveh » Tue Aug 22, 2017 2:05 pm

Does anyone know, if you sell a property in Portugal and the lawyer had POA to sign documents & receive money etc, does he then have an obligation to hold onto some of the sale proceeds until you've had your final tax return because he's legally responsible for making sure you pay all your taxes? Thanks.
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Re: Capital Gains & Lawyers

Postby DaveK » Tue Aug 22, 2017 2:21 pm

Not sure what the exact legal position is but this was our scenario a couple of years ago when we sold a property making a sizeable capital gain. Our solicitor had POA and was our formal fiscal rep. He said he had to retain sufficient to cover the CGT when it was due as he is responsible for any of our debts in Portugal. I gained the impression that this responsibility extended beyond taxes to all manor of civil debts.
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Re: Capital Gains & Lawyers

Postby widge » Tue Aug 22, 2017 8:47 pm

Interesting topic worthy of further research !
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Re: Capital Gains & Lawyers

Postby steveh » Wed Aug 23, 2017 8:41 am

Not our fiscal rep & POA said he has no tax liability. Fiscal rep is happy for him not to keep money back but lawyer says it's normal procedure.
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Re: Capital Gains & Lawyers

Postby logicbob » Wed Aug 23, 2017 9:18 am

I would imagine that because he has POA he is liable for any taxes due to the sale.
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Re: Capital Gains & Lawyers

Postby pato » Wed Aug 23, 2017 8:12 pm

Who get's the interest?
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Re: Capital Gains & Lawyers

Postby widge » Thu Aug 24, 2017 8:31 am

Found this on the net..........."Generally, each conferred power of attorney is revocable, but at property sales the parties often agree on an irrevocable authority. This is especially the case when the owner of a property does not yet have all the required documents for the transaction. Then the owner can issue an irrevocable power of attorney for the "buyer" and in this way secure the transaction for the other party. This power of attorney allows the lawyer to request the missing documents from the authorities and to "sell" the property to the buyer for a determined price. Upon issuing such a power of attorney the vendor already receives the entire price for the property. According to the applicable law the tax on acquisition of real estate has to be paid before issuing such a power of attorney. Thus, in this case the tax is paid before ownership is transferred. The power of attorney assures that the subsequent transaction will take place. Nevertheless, such a transaction does comprise a danger: the issuing of the power of attorney cannot be registered in the land register."
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Re: Capital Gains & Lawyers

Postby logicbob » Thu Aug 24, 2017 6:09 pm

pato wrote:Who get's the interest?


The Lawyer of course. 8)
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