The Portuguese bureaucracy can be challenging, and it is no different when it comes to taxation; that is why having a personal tax accountant in Portugal, and Madeira Island is vital to a successful relocation. This article will outline why having a personal tax accountant is one of the most important aspects of expat relocation.
1. Chose a personal tax accountant with international experience
Expats should opt for personal tax accountants with recognized international taxation experience. Knowing not only the quirks of Portuguese Personal Income Tax but also a broad understanding of foreign jurisdictions and being able to interact with your tax adviser back home is critical.
We at MCS started as a corporate service provider in the Madeira International Business Center and rapidly became a leading management company. As a result of its position in the market, the quality of the services it has been providing for over a decade and full compliance with business ethics, MCS was awarded the Merit Certificate by the concessionaire of the International Business Centre of Madeira, SDM – Sociedade de Desenvolvimento da Madeira, SA.
Within its international presence, MCS also assists its corporate and private clients with European and Non-European OECD tax-compliant jurisdictions, thus reinforcing its international reach and scope as a global provider of management and corporate and expat services. Furthermore, MCS has always understood the absolute need for continuous legal assistance to our clients for operations carried out through our company. This legal assistance was entrusted to a reputable Portuguese independent law team with international experience in corporate, tax, real estate and inheritance law.
The above advantages, which are essential when dealing in various sophisticated jurisdictions, have placed us in great demand by international clients and have resulted in the high standard of MCS’s clients.
2. Facts are facts
A prevalent misperception is that foreign nationals may choose where to pay taxes. If you spend more than 183 days in Portugal in a given year, the Portuguese government considers you a tax resident of the country, and therefore you must file and pay taxes there on your worldwide income.
Be aware of disinformation, especially on online expats forums and word of mouth. This usually originates from one of the following situations:
- Tax-related urban myths spread within the expat community. Other expats try to interpret the regulations in a way that benefits them personally or
- professional advice given concerning an expat’s specific situation and income structure.
Always remember that every situation is unique and, as such, needs to be verified with an internationally exposed tax expert, such as MCS.
3. Accounting advice as an investment
Obtaining tailored advice from the beginning of your relocation process is better than figuring out and doing things independently. More often than not, clients come to us after a snowball effect caused by a single action that they have triggered without prior advice. Receiving tailored advice concerning your situation and worldwide income structure is a small investment that might save you future headaches and even potential loss of tax benefits.
4. Organizing paperwork
Regarding matters about governmental procedures, Portugal is far from being a paperless society. When meeting with your tax accountant concerning your worldwide income structure, it is essential to have your documents all organized. This saves you time and facilitates procedures, especially in a tax audit.
Be sure to have your tax-related documents by type of income and calendar year.
5. Personal tax accountant and reporting obligations
A personal tax accountant will advise you on your tax liabilities in Portugal and Madeira island concerning private or corporate affairs and can assist you with all your tax reporting obligations in Portugal. In addition, a personal tax accountant can also assist you in producing the government-issued documents that you may require to present to the tax authorities back home, should it be the case.
At MCS, we can assist you with your tax matters in Portuguese territory. This article is provided for general information purposes only and is not intended to be, nor should it be construed as, legal or professional advice of any kind. Should you have any questions, please do not hesitate to contact us.