Portugal / Malta Structure..

[Everglow]

Hi everyone,

I'm planning on moving to Portugal under the NHR scheme, and opening a company in Malta, where I'd pay myself dividends from the company to myself in Portugal.

I've spoken with some firms/formation companies in Matla to gather some information, some say it's tricky some say easy.

Has anyone got any experience with this structure? Or any information I'd find useful?

Thanks in advance!

 

[Reinassance]

NHR in Portugal is good for pensioners but not so good for entrepreneurs.
One retired relative is living near Lisbon tax free (pension as only income) paying a 250 € monthly rent but he came in 2017.
Today i don't see much opportunity, real estate is still in a crazy bubble and cost of living is very similar to countries like Italy.
I think new residents have to pay a 10% flat income tax (don't know if it's executive but i think so)
Crypto is untaxed but there is also a 28% capital gain tax that is not very clear if NHR are exempted by it or not.

My advice is to become a Cyprus non dom res, open your company in Malta (or cyprus, uk llp, us llc etc. ) and you can live on tax free dividends.

 

[Everglow]

Thanks for the info. I've heard Portugal is great for entrepreneurs as you can pay yourself dividends from Maltese company at 0% tax.

The set up isn't as straightforward, but once done, quite advantageous.

Cyprus non dom res sounds great too, would this structure allow the individual to live anywhere then?

Thanks

 

[patterson]

My adviser also recommended Portugal NHR + Malta. Still seems solid and well tested. He preferred that to using a US LLC with NHR.

 

[proexper]

@patterson @Everglow
Question: always must be Malta?
is there any special treaty between or once you get the NHR dividends are 0% tax

 

[mcntr]

Hi all,

I will be in a similar situation and would love your thoughts.

I'm a Portuguese citizen residing in the UK and a director of a UK Ltd.
Soon I will be moving back to Portugal and would like to continue working with UK companies.

I read above that an efficient tax setup would be to open a Maltese company and when in Portugal to register for NHR. Has anyone here done that?

Many thanks,

 

[landogarner]

As far as I know the Portugal NHR still works well with tax free income from foreign dividends. However, the timeframe is limited.

It doesn't have to be Malta and please note that Malta is quite expensive regarding company services. Corporate tax is 35% with a cashback some months after tax declaration reducing it to 5% (unless you install an even more expensive solution with a holding enabling you to pay just 5% from the beginning). So company annual cost is high but tax is low - make your own calculation. In Cyprus tax is higher (12,5%) but annual cost is lower. Tax is not the only contribution in Cyprus, search this forum for social security contributions as well. And when I say company services I mean creation, substance and accounting. Substance is so important nowadays to sleep well.

There are some formation companies in Malta that are not so trustworthy as they promise a lot and charge far too much. If everything sounds easy then you should be careful. Also note that creation of a bank account is a nightmare, in Malta even more than in Cyprus. It currently takes up to 6 months if your KYC is ok, your company setup is done well and you have created substance. In Cyprus KYC has become hard as well but is much faster, here the banking fees are very high.

One last comment that might not apply in your case. Have a look at the double taxation agreement of Portugal with your home country. In the case of Germany I know that they tax your tax free dividend income if you live in Portugal under the NHR regime. And believe me : the really do it !

Boa sorte, my friend !

@mcntr : I would be very surprised if portuguese NHR regime would apply also for portuguese citizens...