I have a juicy tax/residency/brexit puzzle I hope you can help me solve, or at least get some clarity on.
I am a British citizen who currently resides in The Netherlands. I have been here for 8 years benefiting from the 30% tax ruling and have permanent residency (this ruling ends in 2 months and my tax rate will go up to 52%).
I work (permanent contract) for a company based in the UK, and visit client sites in Europe about 7-10 days per month usually. Rest of the time I work from home but can do my work remotely from anywhere in the EU as long as am close to an airport that flies to the Milan/Dusseldorf/London. Please note I am the only employee for my company in The Netherlands as I only moved there for personal reasons and there is no Dutch company, just a payroll company that process my salary slips according to Dutch tax/wage laws.
I own my home in Amsterdam as well.
I had long been thinking about moving to Spain, for the weather and quality of life mainly, and due to Brexit realised its now or never. So I began the process of getting residency before the Brexit deadline end of this year (but nothing finalised at all so far) when I realised that Spain is a high tax country and I would be paying about 48% income tax as an employee, once I become a tax resident.
Then I discovered the NHR program in Portugal and began investigating it extensively.
The more I looked into it though, the more questions came up.
Essentially I believe the better quality of life, weather, etc will be about the same for me as Spain (which I technically prefer as am a Spanish speaker) and the massive savings in income tax in Portugal, and then pension savings which I will access in the future, is extremely attractive.
I have consulted a few tax lawyers now and I am getting conflicting information.
I was told that if I continue with the current situation and Dutch payroll handling my salary, I would simply claim NON-RESIDENT status in The Netherlands and then become a tax resident in Portugal and benefit from the 20% income tax for 10 years. Two different tax lawyers in The Netherlands told me completely different things, that YES I would still pay high 52% tax rate as a non-resident, and the other told me NO I would not have to pay income tax anymore in The Netherlands as essentially I would no longer carry out any of my work there.
Obviously if I still have to pay high Dutch tax that totally negates the point of the NHR, but it seems odd I would pay taxes there as a non-resident? I need to be 100% clear about this before proceeding with the NHR scheme. If taxes will be the same, then I prefer to live in Spain ultimately.
Another option the Portuguese tax advisor suggested is to re-establish ties to the UK (bank account etc which I do not have anymore) and then ask my company to set up a Portuguese payroll company, which seems really long winded? I can’t imagine all the Brits wanting to move to Portugal in my position (with full time roles based in the UK) are having to do this?
Essentially, I am trying to ascertain:
In my current position, what is the best and easiest option to move to Portugal, maintain my role with my company (I don’t want to cause them any issues or extra costs during this time) access the benefits of the NHR scheme and be completely compliant in all countries.
I am aiming to maximise my net income over the next 5 years whilst still a high earning employee, rent out my house in Amsterdam, and invest in real estate in my new home country, be that Spain or Portugal. I have to decide quickly due to silly Brexit!
I would be ever so grateful for any insights, ideas or information you might have for me