My company cannot set up in Portugal. They can set up in Australia, New Zealand, UK and Gibraltar. I could get the NHR as a high value added individual.
Can I use an EOR to live in Portugal, assuming the company agrees to pay me via the EOR?
Even better, can I set up a company in Gibraltar, and then use an EOR intermediary to pay me a salary in Portugal so I can live there? (Gibraltar is a blacklist country for NHR)
What are the costs of an EOR?
Do I pay 31% Tax? All of the work is online and for ANZ clients, but I’d be doing it while sitting in Portugal
Hi guys! I wonder if there was any progress @sm33@somartinez in your journey in moving to Portugal? Any further advice? I’m a portuguese national working remotely in the UK to a UK based company and been considering that idea in moving back to Portugal.
Hi Jose - sorry, no, no update from me. Still “thinking about it”!
I might have mentioned it earlier but, from what i can gather, you ultimately can do this (remote work) and benefit from Portugal’s NHR BUT because of the high social security contributions (equivalent of NI in UK), which are much higher than in the UK (the UK caps them, so they’re effectively a few percent for high earners in UK, but in PT they’re more like 20%): overall it saves you perhaps 5%-10% (10% NHR + 20% Social Security in PT -v- 33%-ish Income Tax and 3%-ish NI in UK), which is good, but not “huge” - particularly when you lose other tax benefits in the UK (tax free primary residence etc), and you aren’t able to go back to the UK for more than [90-ish] days / year. Just something to bear in mind.
Hey all, @sm33@somartinez
What about doing this in Spain instead? The Spanish government is approving a law that will come into effect by the end of the year (2022) by which non-residents moving to Spain will pay 15% income tax.
This law has been nicknamed the “startup law” and it follows the known “ley Beckham” (coined when David Beckham went to Spain to play at Real Madrid).
I am going to apply to that one as it seems more advantageous than the Portuguese NHR. Anyone have any info about it?
Start with tax residency: if you are tax resident you pay UK tax and NI - the treaty merely means that any tax you have paid in the other country generates a credit provided it is not more than in the UK. So you would pay UK income tax plus Portugese social taxes and UK NI as NI isnt the same as social taxes. Going from the above you are 11% worse off
IF you are UK non resident you only pay UK tax on capital gains when you return in under 5 years plus dividends on closed companies. I think you need to take advice on UK NI as you are going without a committment to return, but you can always buy added years at a later date
If I were your employer I would sack you as your plan risks my company being registerd in portugal. A minefield
The third party idea needs to go via a specialist accountant as I believe there is a real risk HMRC could consider it naughty
Of course there is a better idea - simply become a world nomad. 90 days in the UK, long enough in Portugal not to be resident for tax and then days in the european winter in the West Indies or Florida. You then pay no tax at all. Your employer just considers you an offshore employy with no tax residency.
I am not sure this is correct, as the treaty seems to say otherwise - see the quote of “Article 15 Employments” in my post above.
One would not need to ‘top up’ the difference in taxes unless spending more than 183 days in the ‘other Contracting State’ i.e. in the UK in this example.
The ‘top-up’ scenario that you describe represents a Foreign Tax Credit Relief and arises where no double taxation treaty is available.