Portugeuse tax returns.

[Homme Poco]

Boa noite,
As me and ´er indoors have our residencia , do we have to send in a Portugeuse tax return?(We do not have an income here , our business is based in the U.K.)
HP
Yes,I am still alive!!!!!!!!!!!!!!!!!!!!!!!!!!

[Cleri]

Yes you have to fill in a tax return,they will fine you 25 euros for each year you havent already submitted one.
Regardless of income over here.
C

[biffa]

Dear Homme Poco

You may have residençia but are you tax resident here? Whilst the two are linked one does not automatically mean the other. If you are tax resident here then you have to declare your global income in Portugal. If you are also paying tax in UK then the tax treaty between the countries may allow for a set off of tax paid in one. Sounds like you need some proper advice!

[Homme Poco]

Boa Noite Biffa.
For the chance of looking completly stupid,what is the difference between having our residencia and being a tax resident.
HP

[biffa]

It is possible to hold a valid residençia and not be tax resident and vice versa. Whilst, on renewal of a residençia card the Serviço do Estrangeiros may ask to see a tax return, the two things are not inextricably linked. You first need to ascertain if you are tax resident in Portugal or not by applying the various tests that dictate that. Once that is decided you can then use the tax treaty between UK and Portugal to set off UK tax paid.

[Homme Poco]

And what would those tests be please, old mate!! grovel grovel

[biffa]

Basically if you are here for 183 days or more in the tax (calendar) year OR the tax man presumes your main place of residence is here on 31st December then you will be assumed to be tax resident. There are one or two other considerations but that is the main test.

[Homme Poco]

Would that be the Portugeuse or English tax man?

[Al Garb]

Both. If your income originates in the UK you will have to prove that you are not domiciled for tax purposes. If you are resident here you will have to demonstrate no income derived here. Even with a reciprocal agreement you can end up paying some tax in both jurisdictions

[Al Garb]

Should have added this link
http://www.hmrc.gov.uk/leaflets/c9.htm

[biffa]

Homme Poco

I have just mentioned the tests that decide if you are tax resident in Portugal, The UK have different parameters.

[Homme Poco]

Our business`operate as Ltd companies and the registered office is in the U.K,does that make a difference? Sorry,suppose I should have mentioned that before!

[biffa]

Yes, a UK limited company has a legal persona in its own right and is therefore separate from you as an individual.

The UK company will be taxable in the UK and not here (unless it had activity here). You may also be taxable in the UK due to your relatonship with that UK company (as director?).

First step has to be to determine/decide if you are a tax resident here or not. Following that you can see what you need to declare in the UK.

[Mike Banks]

Depending on what particular goods or services a UK company provides, and who/where they provide them to, the company may need to be registered for VAT in both the UK and Portugal. Check with HMRC helpline.