Yet another new law on tourism rentals......

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RichardHenshall
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Post by RichardHenshall »

pjmatos wrote:... And you don't need to worry about taxing VAT for anyone from EU but not living in Portugal, there's no VAT applied.
If you are above the threshold for charging IVA/VAT on holiday rental you have to account for IVA/VAT on all your rental income as the provision of the rental is in Portugal. It is irrelevant where your guest comes from.

It's completely different if you are exporting a product to another EU VAT registered business ...
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CSE
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Post by CSE »

Sorry but we still fail to see why it says that where your business and sales are in Portugal you can write a faturar (bill) in any language, or currency.
This article is surly about international trade. But a property let is not intentional trade the point of purchase/sale is in Portugal.
To say that you export your goods you will have to have an international IVA (VAT) number.

The above points apart if you read this the Portuguese authorities will or can ask for translations no matter what.
Este artigo pretende assim abordar, e especificamente em relação ao imposto sobre o valor acrescentado (IVA), a legalidade das faturas emitidas em língua estrangeira, assim como os procedimentos a ter quando as faturas estiverem impressas em moeda estrangeira.
Now that will coast a few Euros!
Never try to out-stubborn your guests.
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pjmatos
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Post by pjmatos »

RichardHenshall wrote:If you are above the threshold for charging IVA/VAT on holiday rental you have to account for IVA/VAT on all your rental income as the provision of the rental is in Portugal. It is irrelevant where your guest comes from.

It's completely different if you are exporting a product to another EU VAT registered business ...
Thank for clarifying this, Richard.

My apologies, there's indeed no VAT applied only when exporting and to a EU VAT registered business.
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CSE
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Post by CSE »

RichardHenshall wrote: If you are above the threshold for charging IVA/VAT on holiday rental you have to account for IVA/VAT on all your rental income as the provision of the rental is in Portugal. It is irrelevant where your guest comes from.

It's completely different if you are exporting a product to another EU VAT registered business ...
Richard raises a good point there.
VAT thresholds also vary with each country.
http://www.vatlive.com/eu-vat-rules/vat ... threshold/
Going onto his point about distance selling, and the point raised in our previous post about an international VAT number.
http://www.vatlive.com/eu-vat-rules/eu- ... istration/
Selling spaces in your rental property is not considered one of the areas covered by distance selling.
Never try to out-stubborn your guests.
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pjmatos
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Post by pjmatos »

RichardHenshall wrote:It's completely different if you are exporting a product to another EU VAT registered business ...
By the way, if you are exporting a product and/or a service.
casasantoestevo wrote:Richard raises a good point there.
VAT thresholds also vary with each country.
http://www.vatlive.com/eu-vat-rules/vat ... threshold/
Going onto his point about distance selling, and the point raised in our previous post about an international VAT number.
http://www.vatlive.com/eu-vat-rules/eu- ... istration/
Selling spaces in your rental property is not considered one of the areas covered by distance selling.
Weird, they don't seem to vary that much here:
http://ec.europa.eu/taxation_customs/re ... annexi.pdf

As far as I understand this directive, there seems to be an objective of normalizing the thresholds:
http://eur-lex.europa.eu/LexUriServ/Lex ... 118:EN:PDF
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pjmatos
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Post by pjmatos »

casasantoestevo wrote:The above points apart if you read this the Portuguese authorities will or can ask for translations no matter what
I think this sums it up: Portuguese authorities can ask for the documents in Portuguese, as you said, but that doesn't necessarily mean that they won't accept it in foreign language no matter what.
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pjmatos
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Post by pjmatos »

pjmatos wrote:I guess it's not yet time to start getting seriously worried, but I again recommend Moloni.
They are going to offer Android and iOS solutions next year.

I just wished that they already had the affiliate program active, you might want to wait for that time so I can give you a code :roll:
Well, I thought they didn't have an affiliate program, but they do, and I already have an affiliate link to share.

Unfortunately the affiliation will only benefit those who invite, which made me suggest them to also create benefits for the invitees.

So, please only ask for the affiliation link if you wish to help me. :)
teba18
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Post by teba18 »

This could be very naive but I have another question I wonder if anyone has a view about.
We want to stay below the IVA threshold of 10,000 euros for rental income because we'd rather avoid having to register for VAT in Portugal. By far the bulk of our rentals come from people in the UK so they pay in GBP ... but the exchange rate obviously fluctuates throughout the year.
Say we quote a price in January when the rate is xxxx but by the time the balance is due, the pound is stronger so effectively we'd get more euros than we expected we would at the time they booked.
Without a crystal ball, does anyone have a magic formula to ensure we don't inadvertently go over the 10k limit?
RichardHenshall
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Post by RichardHenshall »

You could either charge everybody in Euros or you could give your customers a rebate at the year-end if the exchange rate has moved too far in your favour. :shock: :lol:
e-richard
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Post by e-richard »

Do you own the property jointly with your spouse ?

There is a way that you can then EACH take rental income of up to €10,000 giving you a threshold of €20,000 before you need to register for IVA.

I don't know exactly how its done but this was set up by my scrupulously honest accountants, so I presume it's all kosher.
** Richard
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teba18
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Post by teba18 »

Thanks e-Richard - we've asked about each registering as individuals but we haven't had confirmation we can do it although the accountant is meant to be looking into it. Sounds like yours is a few steps ahead!
Charging in euros is a good suggestion but as we've already quoted prices in GBP I think our renters might wonder what's going on ... unless I'm missing something obvious!
I like RichardHenshall's rebate suggestion but I'm not sure it was serious or tongue in cheek! As we understand invoices have to be raised at the time of payment and submitted to the tax authorities then, I'm not sure we could do that without it looking just a tad suspicious! Thanks for the idea though!
noud
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Post by noud »

Of course on Madeira we had to follow the new rules as well.. We already had our AL. So we looked for an accountant here and found the President of the portugese taxmen-club... We were lucky. He forbade us to go to Finanças as we would probably give the wrong answers to the questions over there ending up in the wrong group for tax income ( read, every euro is taxable and accounted for paying 28 % Tax) . He registered our letting activities as an 55201 activity. It means allojamento local basicly as a home owner letting one property. We have had us made the most simplest Fuctura/recibo booklet. (36 Euro´s) He told us, as we have no other income in POrtugal, that the first 10000 euros is taxable but the tax to be paid would be nihil. He fills out our Factura book and delivers a copy once a month to Finanças. As we went to get a sign accorfing to the old rules we had when we got our AL licence we found out that you do not need the sign on your house when it´s a private home.
All his dealings with the taxofffice to get the lot registered etc took 3 weeks and was done via internet. So no chance the taxofice tricked us in the wrong group.

He will do our tax declaration, the once a month deliverance of the factura/recibo book for about 200 euro´s a year.

And of course we have a lot of friends who use the house once in a while according to our Taxman :-D
Codliveroil
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Rant

Post by Codliveroil »

I've been lurking on this thread a bit, we already have the AL and have now been advised by our accountant to register with Financas and our municipality, so done that too, so now I have to pay seg. social, great I need a few years to get a minimum pension. So a large increase in accounting fees because now the Financas want monthly invoices and quarterly expenses, but will only receive the same amount of tax from me! So what is this all about? So done all those hoops, for now.

Then we have been on line, done more hoops, and registered with Siba to submit the bulletins, easy enough, but here's the thing, the law states that we have to register all of the foreigners, including kids, so 6/8 at a time, yet just recently we had some friends from Canada (so we are 4 foreigners), over to stay and off we went on a road trip, Pousada only asked for one ID, NH hotels in Spain asked for only 1 ID, back to a BNB in Portugal asked for nothing then to Tomar, Hotel dos Templarios, only asked for 1 ID.

So, this begs the question how serious is this whole dang thing?

There are currently 11296 rental properties registered with HL in Portugal, not sure if this is the max but maybe more on HA or OD, how many of these are fully compliant with AL, Financas and Siba?

Anyone care to hazard a guess, 5, 10, 15%

There are so many rumors about the authorities clamping down and nailing miscreants that it surely must pay to comply, but seriously, have we not got better things to do, my experience in Portugal is that the authorities will take the easy route and scrutinize those that comply hoping to catch them out on a technicality to rake in some penalty revenue and ignore the rest, because the rest are too difficult to pin down and too costly to pursue in the courts, (which are in a mess).

Any comments?

End of rant.
aasta
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Post by aasta »

In our Sintra area authorities have clamped down big time (we received a visit last year - thankfully all our papers were in order)...we know 3 people who had been renting for over 25 years, who have been visited and told to either comply or shut down. Two have shut down. And we have heard from other holiday let owners and B&Bs that the authorities have a huge list and are diligently visiting everyone.....the inspectors names are known and now when fellow letters meet the first question is "have you been visited yet?"!
We have been informed by the Lisbon Tourist Council that the hotel association of Lisbon has filed a formal complaint about all the unregistered AirB&B places which have sprung up over the past few years and this complaint is another reason for the crackdown.
We register all our guests with local tourism board for statistics and SEF... online it only takes a few minutes....Will they come and charge the fines if we do not comply who knows, but since the fines are hefty we are not going to tempt fate!! Again we know folks who have been fined.
So guess you need to decide how much of risk you are will ing to take......our B&B sees 400 plus guests per year and so we are on the radar!
aasta
teba18
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Post by teba18 »

We've done what we think we have to do to comply so are hoping things will run relatively smoothly. But I do agree with much of what Codliveroil said and I'm sure there are hundreds - maybe thousands - of people renting out holiday properties who either know they're operating 'illegally' but don't believe they'll be caught, or who don't actually know anything about it.
While we have been told that as a couple we could register as two individuals and could then each take 10,000 euros in rental income, we've decided not to risk it right now. It doesn't take a genius to work out that in doing that, one property could then generate 20,000 euros before VAT kicked in and our accountant tells us that Portugal is not unknown for passing new laws and then applying them retrospectively!
Then of course there could be a change of government ........ and everything could change AGAIN!
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