Is Portugal Europe’s Newest “Tax Haven”?
14 July 2015
Home to more than 100,000 British expat retirees, Portugal could be one of the most popular places to retire to in the world. Residents can enjoy medieval towns, fishing villages, traditional architecture as well as open-air markets, local wine and some of Europe’s best sandy beaches. Portugal is a land of cobbled streets lined with whitewashed houses and fig, olive and carob trees and a very beautiful country to enjoy a relaxed pace of life during retirement.
There has however, been a number of concerns raised about the economic growth of Portugal, which has had a significant impact on those looking to move to the country – especially as an expatriate in retirement.
It’s understandable that individuals wouldn’t want to commit themselves to the country when it’s facing economic uncertainty, however as a result, the Government have introduced a new incentive to encourage foreign residents to relocate to the nation. One of the least likely candidates to be labelled a ‘tax haven’ in Portugal, the Government have adopted some innovative thinking to make anyone looking to move to the country think again.
The Portuguese Government have introduced a 10-year tax income exemption window for international residents moving to live in Portugal. This also extends to retirees moving in and receiving their income in the form of a pension and has been backdated to start as of January 1st 2014.
So, if you’re a British retiree, with a pension income, you can now conceivably live in Portugal for 10 years and not pay any income tax during that period.
This means Portugal could potentially become a new tax haven in the heart of Europe.
Please note: Other taxes may be payable during this period.