The Portugese Parliament this week approved legislation making a series of alterations to the existing IRS Code, including a stipulation which allows retired expats who spend part of the year in Portugal, to be free of any income tax.
The move is born from an apparent and urgent need to provide clarity on the functionality of existing legislation, while observers have also expressed the view that the reform will further highlight Portugal, and especially the Algarve, in the bid to be recognised as the “Florida of Europe.”
The new regime unveiled this week foresees an exemption of a foreign occupational pension so long as its beneficiary qualifies for a special tax regime for non-habitual residents.
A recent publication by Deloitte in Lisbon explains that one of the requirements is that the pensioner be a non-habitual resident for Portuguese income tax purposes while the second is that the pension is an occupational pension, paid from a foreign source.
Should these requirements be met, the pension will not be taxed in Portugal and depending on the provisions of the applicable tax treaty, it is also usually non-taxable in the source country for the duration of residence in Portugal.
Read more: Zero tax on expat pensions - The Portugal News
No comments:
Post a Comment