So if you’re like me and you’ve procrastinated on filing your IRS declaration in Portal das Finanças, because it’s a bit scary and everything is in Portuguese, here’s what I’ve learned so far:
- the most important things are already in there. so always start from a pre-filled declaration, don’t start from a blank one.
- do not touch Anexo H, unless you know what you are doing. I first, when googling, thought this was the annexo to get reimbursed for all of the medical and rent expenses. but it’s actually the annexo you file if your deductions are different than what’s on file (aka you didn’t include your NIF at the time but could have). the shitty aspect: if you do file it, you have to provide the TOTAL amount of deductibles for the year, not just the missing ones. so the whole idea of always giving your NIF at the counter breaks down if you declare this annexo.
- declaring Anexo J for a foreign bank account and even foreign income is not a bad thing. I did both and nobody came knocking or fining me. especially if your country has a tax treaty with Portugal, taxes you paid over there might actually be deducted here.
- the best documentation is the official Finanças page, not even e-gov.pt. it’s in Portuguese though and even DeepL doesn’t always translate everything correctly, so it’s a bit of a puzzle if you want to be exact.
- if you have NHR / IFICI and make use of any tax benefits that come with if, you always need to declare them in Anexo L. My employer had my NHR status registered in their books, so my paycheck already came with the 20% flat tax. But if you don’t declare it in Anexo L, they’ll want the taxes you didn’t pay back. Similarly, they reimbursed the taxes I paid too much because my employer didn’t yet deduct 20% taxes, but more. Goes both ways.
- If you have passive income and NHR you still need to file Anexo L to benefit from the tax exemption on e.g. dividends or rental income. Select the credit method (Método de isenção) in either C1 or C2 (depending on when you got NHR) in Quadro 6 of Anexo L.
- I’ve always done the declaration myself bc I am cheap, but there are options if you don’t want to:
- Accountants that do it for you (300-500€ for a basic return, more for crypto/property/NHR). There are expat-specialised ones like taxbordr – not affiliated. many of my friends do it that way.
- AnchorLess and Tytle — fully done-for-you expat services, I guess they also have an accountant somewhere in the process, haven’t tried & know no nobody that did. Does somebody have experience with them?
- Plus, there are tools that pre-fill a declaration for you & you then upload it to Finanças:
- tax-wizard – good for stocks/crypto, not affiliated
- Simples — disclaimer, I built this one specifically for my needs as an expat. It has a free check that tells you what annexes you need & whether your case is supported before you pay anything.
Few things I don’t know yet / haven’t tried, would love your experience:
- if you submit late: I hear there’s a fee but reports vary. from what I’ve read, voluntarily filing late keeps the fine lower, but how much are we talking? In Germany e.g. you first get a letter that you were late and they only fine you if you still don’t file it after that. has anyone been hit with this and were they nice if you then submitted quickly?
- I found out that there is a Modelo 49 form that allows you to extend the deadline if you have foreign income and you’re waiting on docs from the source country. allegedly there is no AT approval needed, but they fine you if you don’t meet the criteria. so it seems a bit risky. has anyone done it & can share their experience?
happy to DM if anyone’s stuck on a specific annexo, especially Anexo J or L.