Madeira Free Trade Zone (Portugal)

[Super Tucano]

Martin Everson said:
They describe a normal holding structure for offshore activity i.e Malta holding company with an EU subsidiary (non-Portugal). How does this solve your tax issues of living in Portugal with a Maderia company? This Would only work tax wise if EU subsidiary is OUTSIDE Portugal where you will be tax resident....lol.

You totally misunderstood the setup 😕.
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Based on what? I know for a fact that I can get a Portuguese holding (SGPS) with a Madeira subsidiary and retain or reinvest the profits by constituting other subsidiaries, tax free. With the EU freedom of establishment for companies, if I can have it in Portugal I can also have it in another EU country. If you can show otherwise, I'm all ears.

 

[Martin Everson]

Super Tucano said:
I know for a fact that I can get a Portuguese holding (SGPS) with a Madeira subsidiary and retain or reinvest the profits by constituting other subsidiaries, tax free.
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So you are setting up a structure with a corporate tax law that lasts only 7 years and a NHR residency status that lasts only 10 years. Add to this you will be attempting a tax avoidance structure where anti-abuse clauses mean the tax authority may disregard transactions where the main purpose is to eliminate or reduce taxes. Plus EU ATAD has come into effect. I mean what could go wrong...lol. It sounds a good intermediate plan with risk for max 7 years but the devil is in the detail.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[JustAnotherNomad]

I have looked a bit into the whole NHR thing. I would not do it. There is so much uncertainty associated to it (CFC rules, anti-avoidance rules etc.), there is the limited time frame, but most of all, it seems like Portuguese bureaucracy is an absolute NIGHTMARE. Talk to some Portuguese people, they will tell you it's hell on earth.
What good is it if a structure might work in theory (or maybe not, depending on what the tax office decides later), when you can't get an advance ruling (because they don't look at hypothetical cases), when you can't do anything without a lawyer etc. etc.
You'll want very clear, established rules, with many precedents, not some complicated structure with lots of ifs and buts.

 

[marble123]

Super Tucano said:
Thank you for the feedback.

So that's the main issue people have with it?

The tax benefits are tied to the number of jobs you create but one of the jobs can be yours and that allows you to have up to € 2,73 million of taxable income at the 5% rate.

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Plus, if you create less than 6 jobs, you have to invest €75,000 in the acquisition of tangible or intangible (goodwill, copyrights, trademarks, intellectual property, etc) fixed assets during the 2 first years of activity.

I can live with that. My fear is an overbearing tax office or a big amount of ongoing paperwork/bureaucracy.

Ceuta and Melilla would unfortunately bring about the problem of effective management rules and also substance for someone living in Portugal.
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Any 'creative' ways to carry out the €75,000 investment in the acquisition of fixed assets?