PERSONAL TAX CHECK UP
It is very easy to fall foul of the Tax Department and to create a tax debt simply by being late with a property or car tax payment. Tax demands are sent to the individual’s or company’s address as registered at the tax department. Often these are out of date as people forget to update the tax department when they move house or if the address is that of a lawyer or fiscal representative with whom there is no longer contact.
Outstanding taxes incur interest and penalty charges each full month they remain outstanding. Once the payment deadline passes, the tax department sends a reminder followed by a further letter informing that a charge will be placed on the tax payer’s assets with a view to selling them for debt recovery. This can happen even for small debts below 100 euros!
Sovereign can offer to check your tax situation in Portugal to ensure there are no outstanding debts or demands for tax returns which should have been submitted as a result of undeclared income from the rental or sale of a property.
For further information on this service please contact Isobel Costa on icosta@sovereigngroup.com
MUNICIPAL PROPERTY TAX PAYMENTS (IMI)
As a clients’ fiscal representative Sovereign will receive and deal with the Municipal property tax bills (IMI). It is very important that these are dealt with in a timely manner as interest and fines can be very quickly applied. In severe cases the Tax Department may force a sale by auction of a property which is delinquent for non-payment of Municipal Tax. Never take chance on this and for more information on our services contact Amélia Jacinto on ajacinto@sovereigngroup.com
PROPERTY TRANSFER TAX (IMT)
Property Transfer Tax is a tax levied on the transfer for consideration of real estate located in the Portuguese territory. The acquisition of more than 75% of the share capital of a Portuguese company, which owns real estate located in Portugal, is also subject to IMT.
Whilst IMT for the purchase of property is usually settled by clients’ lawyers at the time of purchase, Sovereign can assist with payments.
For details of tax rates and compliance contact Marina Dutra on mdutra@sovereigngroup.com
CAPITAL GAINS TAX
On sale of a property by a non-tax resident individual, a capital gains declaration must be filed at the tax department between the months of April and June of the year following the sale whether capital gains have been incurred or a loss made. Any tax due at the rate of 28% must be paid upon receipt of the tax demand.
In the case of a sale of a corporate owned property a tax report must be submitted to the Tax Department within 30 days of the sale again whether capital gains have been incurred or not. Any tax due at the rate of 25% must be paid at the time the declaration is submitted.
Sovereign can prepare and submit capital gains tax declarations on your behalf to ensure you are compliant.
For more information contact Marina Dutra on mdutra@sovereigngroup.com
WEALTH TAX and INHERITANCE TAX
Neither of these taxes exist in Portugal which can in some ways be considered a tax haven!
There is no tax on disposals between ascending and descending close family members but in respect of disposals by gift or inheritance of Portuguese sited assets to persons outside those relationships a Stamp Duty of 10% is payable based on the tax value of the asset concerned.
For more information contact Andreia Vieira on avieira@sovereigngroup.com
TAX REVALUATION OF PROPERTY
Many properties in Portugal are being charged their IMI property tax with out of date figures which means many clients are paying too much yearly Municipal tax.
Sovereign can submit a revaluation request to update the tax value. This has been successfully done in many cases and as a result has saved clients thousands of euros in taxes.
For more information contact Isobel Costa on icosta@SovereignGroup.com