Lay My Hat

Oh dear, another great move by the PT Guv. That's right stop the tourists coming.........doh!

http://portugalresident.com/holiday-ren ... t%E2%80%9D

What did Churchill say, "A government who tries to tax itself into prosperity is like standing in a bucket and trying to lift it" or words to that effect.

The current (very low) rate did a great job of bringing many owners out of the grey market and encouraging people to report legitimately.

If the rate soars as suggested, it will not increase the tax received as it will send many owners back into the grey market and we'll all find occupancy levels will "drop", rental rates will "fall" and the Govt will be back to square 1 - unless they also find the wisdom

Wise words indeed.

I heard thru the grapevine 35% can anyone confirm this?

I call your 35% and raise you 4%.

e-richard wrote:I call your 35% and raise you 4%.

Big mistake I have a full house!

This socialist government are dealing marked cards, no matter how you play you can't win

You need to be careful if you're going to play poker in an unauthorised place - remember this?

My understanding is that it's proposed in the State Budget that the percentage of gross income for AL lettings that is deemed to be taxable profit is to increase from 15% to 35%, so the effective tax rate (in Portugal) will increase from 3.75% to 8.75% of gross income.

How could they be so greedy?

RichardHenshall wrote: My understanding is that it's proposed in the State Budget that the percentage of gross income for AL lettings that is deemed to be taxable profit is to increase from 15% to 35%, so the effective tax rate (in Portugal) will increase from 3.75% to 8.75% of gross income.

How could they be so greedy?

Ok so, 9ish% is not that large an amount and I'm happy to pay it in principle. BUT if you're on the simplified regime, as I am you can't discount actual costs or renovation, replacements etc. I bought my place with old appliances which are constantly breaking down and old towels, bedding etc. which I'm renewing bit by bit. So two years after buying I'm yet to make any profit let along earn enough to pay my mortgage on the place but I am nevertheless paying tax on the turnover. An increase would seriously make me consider whether it is worthwhile continuing to do holiday lets.

To make things worse, someone must have put a decimal point wrong somewhere or something as a result of which the Portuguese tax authorities are claiming €600 for the first year of activity in which I should actually owe them only about €100. Despite several appeals from my accountant this has not been resolved and they will probably end up charging me a fee for late payment.

OrangeBlossom wrote:... To make things worse, someone must have put a decimal point wrong somewhere or something as a result of which the Portuguese tax authorities are claiming €600 for the first year of activity in which I should actually owe them only about €100. Despite several appeals from my accountant this has not been resolved and they will probably end up charging me a fee for late payment.

Did you (or your accountant) omit to select box 10 (Sim) of Quadro 3B (Estabelecimento Estável) of Anexo B? If not you will not get the 15% coefficient applied and will pay 25% withholding tax (not 3.75%) (ie 6.67 times more tax). If that's the explanation, correct the mistake and submit an amended return.

RichardHenshall wrote:
Did you (or your accountant) omit to select box 10 (Sim) of Quadro 3B (Estabelecimento Estável) of Anexo B? If not you will not get the 15% coefficient applied and will pay 25% withholding tax (not 3.75%) (ie 6.67 times more tax). If that's the explanation, correct the mistake and submit an amended return.

Thanks for the suggestion, I'll have my accountant check that possibility. I let him deal with it so haven't seen the actual return.

Try having property in Italy - where tax rates start at 23% and you cannot deduct any expenses from the income, just a miserly 5% of gross income. Doesn't even cover advertising and utility costs!