Expert Info

Posted by JayMalone
on 5 Jun 2018

Hello,

I have started working just over half the time for my UK employer at home in Portugal. My employer did an assessment and determined that in these circumstances I would still pay UK PAYE (which is clear from the tax treaty between the two countries) and I am still paying national insurance in the UK. So, so far, no change.

I am intending to register as a non-habitual resident. My question is about the tax exemption:

"3.1 Income derived from employment (category A) is exempt from any taxation in Portugal if:

a) It is taxed in the country from which it derives, according to the double taxation agreement in force between that country and Portugal or, in the lack thereof, according to the OECD Model Tax Convention."

and whether it applies. It seems to because the income is taxable (and will have been taxed) in the UK under the tax treaty. Anyway, has anyone seen this situation before and, if so, can confirm (or otherwise!) that I will have no additional tax liability in Portugal?

Same question for national insurance / social security.

Thanks in advance for any help,

John

 

 

Kyle de Villiers on 18 Jun 2018

Hi John,

Considering the double-tax agreement between the UK and Portugal, it looks like you have no additional liability. 

For your social security, you should apply for an A1 form, which you can be done through the UK government website. The A1 form allows you to continue paying UK social security without being obliged to pay for Portuguese social security. 

That being said, you should definitely consult a tax expert to make sure. 

 

-Kyle