Portugal Taxes

[keats]

Hey there,

I'm an online businessman and have a ton of businesses. I profit between 50-100k every month.

What's the best way to avoid heavy Portuguese taxes?

I haven't been registered in the Portuguese tax system yet.

Any tips? I'm thinking of opening a business in HK, keep the money there and pay the taxes and sign up as an employee and paying the salary taxes in Portugal. Does this make any sense?


PS: Anyone here from Portugal?

 

[Martin Everson]

keats said:
I profit between 50-100k every month.
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Where does profit come from i.e Portugal or offshore?

keats said:
What's the best way to avoid heavy Portuguese taxes?
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Leave Portugal

keats said:
I haven't been registered in the Portuguese tax system yet.
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Your not a Portuguese national or simply never worked there?

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

 

[keats]

I'm a Portuguese national but was born in the UK. Never worked, always worked online and always avoided putting anything under my name.

All transactions come from outside the EU and the profit just sits in Revolut, N26 etc.

Not really keen on leaving Portugal.


What I have on my mind is pay taxes on part of the money and keep the rest somewhere else.

 

[Martin Everson]

Portugal's tax rules are very aggressive and so is its CFC rules if you plan on using an offshore entity to bill and draw down income from. You would need to setup an operation that is totally offshore and where you have no control or ownership in it at all. Minor interests in such offshore entities are allowed but if taxman gets a sniff of it then its like a red rag to a bull and you will be audited and harassed for eternity.

So best to structure something where the company earning the money is in another low tax EU member state (not non-EU) and totally not associated with you down to UBO level. Then draw a salary from that company as i.e a freelancer while keeping the money parked within the company. For example you could use a Estonia company that is operating, managed and UBO resident in Estonia. Estonia companies only pay tax on distributed profits. Hence you can warehouse your income tax free in the company indefinitely minus expenses. Challenge is you need someone trusted who is over there in Estonia managing the company as director, shareholder and also acting as UBO.

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

 

[keats]

Thank you for your feedback.

Martin Everson said:
So best to structure something where the company earning the money is in another low tax EU member state (not non-EU) and totally not associated with you down to UBO level. Then draw a salary from that company as i.e a freelancer while keeping the money parked within the company. For example you could use a Estonia company that is operating, managed and UBO resident in Estonia. Estonia companies only pay tax on distributed profits. Hence you can warehouse your income tax free in the company indefinitely minus expenses. Challenge is you need someone trusted who is over there in Estonia managing the company as director, shareholder and also acting as UBO.
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Sounds a bit hard to set this up. But might be the best way around it.


Any idea how taxes work if I work for a foreign company? Say I work for a Thai business, they transfer money to my Portuguese account, how do I go with paying taxes on that? Assuming i have an employment contract iwth the company.

 

[Martin Everson]

keats said:
Any idea how taxes work if I work for a foreign company? Say I work for a Thai business, they transfer money to my Portuguese account, how do I go with paying taxes on that? Assuming i have an employment contract iwth the company.
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You register as self employed and use an accountant to take care of everything. With 50k-100k a month in profit you are earning that's enough to take from it 100 euros and ask an accountant. There are plenty of freelancers in Portugal btw.

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

 

[keats]

I've spoken to countless accountants and none could give me a proper answer. Most of them don't know how to deal with online businesses.

 

[keats]

Is there any Portuguese member on this forum that would be able to help?

 

[codaso]

If you have not been tax resident in Portugal for the last five years, do some research on NHR tax regime.

 

[juvejuve2020]

keats said:
Is there any Portuguese member on this forum that would be able to help?
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I am from Portugal too, but i cant help on that question. But, the n26 and revolut you dont have in your Name? And about the CRS? How do you deal with that?

 

[tariq]

keats said:
I'm a Portuguese national but was born in the UK. Never worked, always worked online and always avoided putting anything under my name.

All transactions come from outside the EU and the profit just sits in Revolut, N26 etc.

Not really keen on leaving Portugal.


What I have on my mind is pay taxes on part of the money and keep the rest somewhere else.
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Have you considered becoming non-dom in Cyprus or UAE? Not much obligations and nearly tax free unless you reside there. Can then host your company anywhere convenient
I have also wasted quite a bit of time with Portuguese accountants and not many of them understand tax optimization at all. However Cyprus/Malta entity + NHR regime seems to be the most time-proven here. BTW can you get NHR if being a national but not resident in last five years?