I wish to spend my retirement abroad.
How can I receive my French pension when I’m leaving in another country? First, you should contact your pension provider – the fact that you reside abroad during your retirement should be compatible with receiving your pension. However, you should contact the provider so that you are aware and up-to-date with as aspects of receiving it while abroad.
• Every year you must issue an "existence justification" – each year you should issue this document by the competent authority in your residence country (notary, city hall, …), or by the French consulate and send it to your pension provider. In case you do no do it, you might have problems in receiving your pension.
Should I take specific precautions in regards of health and social protection?
If you have a retirement from the French social security system and you live abroad, you can, in most cases, return to France to receive healthcare. However you should affiliate with the local social security system if the legislation allows you to.
Will my stay abroad impact on the transmission of my patrimony?
The location of you fiscal residence has an incidence over the applicable fiscal regime in what concerns donations and inheritances. However, the applicable law in terms of international succession is often complex, and depending on the country of residence and the location of the real-estate and property and other possessions. There can be, for example, a taxation of the patrimony in both countries. It is always in your best interest to make a situation point with the fiscal administration or a notary prior to your depart.
Source: Expatriation, 15 Clés pour partirl’esprittranquille (Ministére des Affaires Étrangers et du Developement International)
Fiscal Benefits (during 10 years)
The recognition and acceptance of this regime, means the access to a fiscal treatment with some possible advantages, and for a period of 10 years, in which we outline: exemption of taxation of passive income. Passive incomes, as well explained after, is the income obtained abroad, and since the source State can tax. Here are excluded the states with fiscal regimes listed in Portugal as "blacklisted", which includes basically all off the fiscal paradises, as well as those not part of the OECD.
The source States are basically those with which there is a double taxation agreement/protocol with Portugal.
The following incomes are included in the above: retirement pensions, capital incomes, property, stock profits, patrimony increments, intellectual or industrial property, scientific, artistic and technical incomes.
The work income (independent or dependent) obtained in Portugal and which come from high added value activities, are taxed in Portugal at a fix IRS rate of 20%.
Summarizing, and regarding the retirement pensions in particular, which are generated outside of Portuguese territory, even if not taxed in their Origin Country, benefit from IRS exemption in Portugal.
The change in the Juridical "Regime of Instalation, Exploration and Functioning of Touristic Resorts", already enforced in 2014 ("decreto lei 12/2014 de 23 de Janeiro"), clearly directed to towards the simplification of procedures, aims to reducing costs and conditions for these type of resorts, adapting to the actual economical situation, and as we also foresee, what will contribute to make this sector increasingly attractive to investors.
Fiscal Regime of Non-Habitual Residents in Portugal
The Fiscal Regime of Non-Habitual Residents ("RNH") establishes a very favourable regime for foreigners who decide to set their fiscal residence in Portugal. The "RNH" is effectively one of the most competitive of the European regimes in this matter, partly because there is no "deemed/lump sum taxation" as in other European jurisdictions, the inexistence of limits to the remittances to Portugal, and the inexistence of tax over fortunes and over successions or donations in favour of the spouse, ascendants or descendants. Also, there are no costs associated with this regime, which is granted over a period of 10 years.
Who can benefit?
A Non-Habitual Resident is someone who:
• becomes a resident contributor accordingly to the IRS code ("Código do IRS");
• was not a resident contributor of the IRS during the previous 5 years to to the application of the regime.
As a rule, an individual is considered a resident contributor if he spends more than 183 days in Portuguese territory, or, regardless of the time spent in Portuguese territory, has in Portugal a permanent and own house by the 31st of December of the fiscal year in cause.
What are the benefits?
The benefits resulting of the "RNH" go from the total exemption for certain types of incomes, to the application of a unique rate of 20% (transitorily 23,5%) applicable to other type of incomes.
Income obtained abroad:
•The "RNH", although it is a simple procedure, demands and careful and strict preparation work, for which it is highly recommended a specific-case evaluation to identify if the situation gathers all the demanded points, and of what can be the range of the applicable benefits. •
Income from Pensions:
These are exempt from taxation in Portugal, as long as they are taxed in the source state, and inconformity with the double taxation agreement between Portugal and the state in question, or, alternatively, byy the criteria defined in the IRS code, in which is found that those incomes are considered not obtained in Portuguese territory.
Sources: Documents "Mercado imobiliário em Portugal"; "Contexto legal e fiscal" – AutoridadeTributaria e Aduanaeira
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