This is the first in a 3 part series on Residency status in Portugal.

Increasingly, countries challenge former residents who attempt to move to another. Although the rules vary, most states define a “resident" as an individual who is in the state for other than a temporary or transitory purpose. Countries consider a person’s “residence" or home to be the place of his or her permanent home to which he or she intends to return to whenever absent from the state for a period of time.
Most claim the right to tax an individual’s income if they are believed to be a resident. Usually, they also impose tax on 100% of a resident’s income from all sources, including investment portfolio income.

In this issue, the major stories that we look at are:

• Bank of England's decision to retain interest rates increases and why the "U turn"?
• S&P warns the UK will loose its "AAA" rating on an EU exit
• The new Dividend tax regime in the UK - more taxes for all?
• The HMRC failure in collection of taxes - only 11 prosecutions for offshore tax evasion since 2010 to date
• Bank deposit compensation reduced from £85,000 to £75,000 on 1st January 2016

As always, if there is any aspect within this month's Tax Insight that you wish to attain further detailed information on, or you would like to have any of our previous issues of Tax Insight, please feel free to contact us.

T: +351 289 392 484
W: privatefundmanagement.com

CLICK HERE to read the November 2015 Market Insight.

An insight  by into what's happening with the current Financial Market by Private Fund Management, including the Euro falling as ECB plans new QE, plus the latest news on Commodity Markets and Volkswagen.

CLICK HERE to read.

If there is anything that concerns you with your financial affairs, or would like a second opinion, please contact us for a no obligation and confidential discussion.

E: info@privatefund.management
T: 289 392 484

Pensioners who were born before 6 April 1951 (6 April 1953 for women) now have a limited period in which to boost their entitlement to their current state pension. They will be able to buy extra entitlements to their state pension of up to £1300 a year, for life. This will be achieved by making a lump sum payment in the form of voluntary class 3A NIC, between 12 October 2015 and 5 April 2017.

Fitch Ratings has affirmed Portugal's Long-term foreign and local currency Issuer Default Rating (IDRs) at 'BB+'. The Outlook is Positive.

The issue ratings on Portugal's unsecured foreign and local currency bonds have also been affirmed at 'BB+'. Fitch has also affirmed Portugal's Short-term foreign-currency IDR at 'B' and Country Ceiling at 'A+'.

Do you keep large deposits in bank accounts? If so, you need to understand to what extent you will be protected in event of bank failure.

For peace of mind you should establish what investor protection you have with each of your banks, and how it works. The same applies for capital you have held in other financial institutions like investment firms, insurance companies etc in the event of institutional failure. If you have any concerns about the level of protection you should establish if there are other institutions or investment structures which offer a higher level of protection, or if there are steps you can take to feel safer.

RETIREMENT PLANS WRITTEN UNDER TRUST OR CONTRACT - Recent action has been taken in various civil law countries legislating directly against, what are seen as, tax avoidance schemes. As a result of this a lot of standard trust based plans, such as pensions, have been caught. For example, new legislation in France has created highly complex wealth and inheritance taxation rules and the exemptions available for pension trusts are limited, while recent legislation in Spain has resulted in “look through” provisions for trusts.

This month's Market Insight Newsletter is centred upon the UK Budget, and in particular the changes to be adopted to the taxation of Dividends starting in 2016.

We would also like to take this opportunity to restate our investment service offered by Rathbones of Mayfair, London. Upon introducing this service to Portugal at the start of 2015, we have been overwhelmed with the demand.