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Oliya View Drop Down
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Direct Link To This Post Topic: Social Security payments
    Posted: 22/June/2016 at 10:31
Hi folks,
I don't know if anyone can help me....I bought a villa to rent out and am doing it the "legal" way via the AL licence.  I haven;t found a positive reason for doing this yet as it seems to be a means to screw money out of me !  The thing I am struggling with now is that I can't get a portable A1 to avoid paying social security because I don't work in the UK, I gave up work to look after my children.

I'm guessing I am not going to be able to find a way round paying the ridiculous amount of SS that the Portuguese Government wants me to pay, am I ?

If anyone can help I would be grateful.
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Jayjan View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 12:02
Oliya you might be best asking the question on facebook pages you are a member of. I should imagine there are some folks in same situation that could give you info.
Polli the dancing cat strikes again.
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Oliya View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 12:04
Yeah, will do, got some great help from here before though so thought worth an ask.
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Richardk View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 17:18
Hello Oliya
Income earned is always subject to 'national insurance' contributions in any country - ie to contribute to the services we all use. As far as we understand - if you can provide proof of NI payment in UK - you are not required to pay here as you are 'paying into the pot' a bonus even if have addition income here. With a good accountant you minimise your tax - sorry but everyone should be legal - it is not an option! No one likes taxes but we like to be able to take advantage of health services etc when we need.
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Oliya View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 17:34
The thing is I don't pay NI, I receive NI credits instead (not money, I am not on benefits )  because I gave up work (made redundant) to look after my young children - and for this you receive NI credits.   It seems from what the HMRC tell me, that its as much to do with tax.

It certainly seems to be an option not to be legal in Portugal,  I know plenty who never bothered legalising their rentals - including the previous Portuguese owner !  Even my solicitor said it wasn't worth the hassle.
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Jayjan View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 17:54
Because you are  receiving  NI credits, would that not suffice. Have you rung DWP and asked advice  regarding your situation.?
Polli the dancing cat strikes again.
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Oliya View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 18:06
Thats what I thought too Jayjan, I have written and explained it to them twice, but the last letter said I had to be employed or self employed - as if paying tax was necessary.  I would pay contributions here except I am not allowed to because I am receiving credits - but I can't work AND look after my children full time in order to pay tax/NI !  Its crazy.
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Direct Link To This Post Posted: 22/June/2016 at 18:53
Oliya, are you resident in the UK or Portugal ?

I've had to complete HMRC form CA8421i - although I do work in the UK

Link is here.
https://public-online.hmrc.gov.uk/lc/content/xfaforms/profiles/forms.html?contentRoot=repository:///Applications/NICs_iForms/1.0/CA8421i&template=CA8421i.xdp

According to the form

EEA nationals

From 1 May 2010 social security liability is determined by EC Regulation 883/04. Under this regulation the authorities of the country in which you are resident will determine which country's social security legislation will apply.

So if you live in the UK, they should be able to provide you with proof that you are resident and liable for social security in the UK - and therefore not Portugal.


There after, any income from the rental of the property is taxed at a rate, around 4-5% (its 20% tax on 15% of the total income before expenses) - try to avoid going over 10,000 euro or you will have to add on VAT and that starts a lot more problems!

Don't forget you will also need to declare the income in the UK :-(

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Oliya View Drop Down
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Direct Link To This Post Posted: 22/June/2016 at 19:59
Thanks Stuart, the problem is that I don't work because I look after children following redundancy.  I completed their silly form and it got me nowhere :-(

Yeah, thanks, we are only taking a few bookings to cover some expenses, not expecting to go over 9999.00 euros to avoid the IVA position.
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Jayjan View Drop Down
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Direct Link To This Post Posted: 23/July/2016 at 13:19
More trolls at work. They need deleting.
Polli the dancing cat strikes again.
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Andrew View Drop Down
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Direct Link To This Post Posted: 23/July/2016 at 14:23
Yep, admin can you bog those three posts off please?
Andrew
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Oliya View Drop Down
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Direct Link To This Post Posted: 23/July/2016 at 19:02
D'uh....don't we all need these idiots....
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kholtham View Drop Down
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Direct Link To This Post Posted: 25/August/2016 at 15:45
A reply to stuart' s posting, under the new Alojamental local laws for which all should be registerd if renting out an apartment. This is now classed as a business as far as Portugal is concerned, therefore it comes under section 7 of the double tax treaty between uk and Portugal and not section 6 which means income does not have to be declared in the uk. I have had this confirmed by NALLE for which I am a member, they are sponsored by Eurofinesco accountants. Knowing the uk inland revenue as I do through my work in accounts I found it hard to believe that the uk would accept this but it is Portugal that stipulates that it is business income and not uk and the uk have to abide by the double tax treaty. I am yet to try this out though in the uk as I have not yet had to file a tax return for my first year of renting.
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Direct Link To This Post Posted: 26/August/2016 at 11:22
Originally posted by Andrew Andrew wrote:

Yep, admin can you bog those three posts off please?

If you see spam like that or other undesirable posts, just click (at that post)  'Post options' then 'report post' and it fires a message off to admin and other moderators. The different sections cannot be individually monitored.
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