Lots of companies claiming they can help tech workers (digital nomads) from the UK move to Portugal and pay 0% tax on income. Surely this can't be true?
I have attached some screen caps to evidence these claims.
It just all seems a little too good to be true, and with the window of opportunity closing I'm keen to learn more.
Anyone have experience with this?
Here is one such example:
"This is possible, in part, due to Portugal’s 71 double taxation treaties. According to the regime, as long as the source country of your income has the power to tax your income (regardless of whether or not they actually apply the tax), Portugal will not tax your foreign-sourced income.
The list of income sources that will not be taxed under this set-up includes foreign-source self-employment, royalties, eligible occupations, dividends, capital gains, and investment or rental income."
Many thanks.
This is false. Just about all of it.
That isn't how these double taxation treaties work.
What it actually means is that if multiple countries can assess you for taxes, they both do at whatever the rate is and they get a dollar amount.
Then the most direct claim against your taxes (typically the one of the country you are physically present in when working) takes their tax.
then the second/others look at their number, and subtract the taxes you already pad to the first country. And now they take their tax if the number is still positive.
So, no, it has nothing to do with just "a country CAN tax your income", but SPECIFICALLY how much taxes they take.