Airbnb promotes luxury

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The holiday let reservation platform has added “Airbnb Luxe” to its options. The new category makes available luxury accommodations and associated premium services, such as a route planner, chefs and masseurs. The Airbnb Luxe promises offerings to guests that are “the most extraordinary houses in the world”.

Non-habitual residents register 26% increase in 6 months

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Despite an inauspicious start in 2009, the “NHR” programme has gained relevance, attracting thousands EU “tax refugees” to Portugal. Since 2014, new applicants have increased by 1400%. Between September of 2018 and March of this year, the number of new non-habitual residents rose by over 26%. Brazilians recorded the most significant jump with a gain of 52%, surpassing the Swedes. Citizens who qualify for “NHR” status pay “IRS” at a flat rate of 20% when they are linked to high added-value activities in Portugal. However, this group of targeted professionals accounted for just 7% of total applicants. Most are pensioners, seeking a 10-year tax holiday on their retirement benefits. In 2017, new “NHR” retirees numbered almost 10,000.

EU triples tax haven blacklist

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The EU has broadened its blacklist of tax havens, adding 10 new jurisdictions; Aruba, Barbados, Belize, Bermuda, Fiji, the Marshall Islands, Oman, the United Arab Emirates, Vanuatu and Dominica. They join Samoa, Trinidad and Tobago, and three U.S. territories of American Samoa, Guam, and the U.S. Virgin Islands which were already listed. The European Commission created its blacklist in December 2017 after revelations of widespread tax evasion schemes (“Panama Papers”) used by corporations and high net worth individuals to reduce their tax liabilities. Listed jurisdictions face enhanced financial scrutiny but as yet no sanctions.

Closing your Local Lodging business

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There may be a variety reasons for you to discontinue an “AL” business: a) you need your place for yourself; b) the property may be up for sale; c) the bureaucracy may be too cumbersome for you; d) competition may have driven down prices and the activity is no longer profitable, e) other. Whatever the motive that you no longer wish to continue to let short-term furnished accommodations to holidaymakers, there are several steps that you will need to take to make the change: Continue reading

EU removes three countries from its tax haven blacklist

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Bermuda, Aruba, and Barbados have been on the EU’s embargoed list since March because of loopholes associated with money laundering schemes. Under the EU’s fair tax criteria, companies must have “economic substance”, not be just a “letterbox” entity set up to take advantage of low tax practices. The current EU blacklist has 12 countries. De-listed jurisdictions are placed on a halfway ‘grey list’ under close scrutiny but are no longer be subject to sanctions.

French “Great Debate” website attacks Portuguese “NHR”

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Opinions and proposals, shared on the “Great Debate” website (https://granddebat.fr/) – an initiative by French President Emmanuel Macron to respond to the protests of the “yellow vests” – refer to migrating French nationals who enjoy Portuguese Non-Habitual Residency (“NHR”) as “tax exiles” and to Portugal as “a fiscal eldorado” within Europe. Some participants contend that this double relief (tax exemption for pensions both at source in France and for 10 years in Portugal with “NHR” status) is intrinsically unjust, depriving both states of much-needed tax revenues and increasing the burden on paying taxpayers. The scheme is seen as promoting unfair tax competition among the Member States of the European Union.

“IMI” updates in 2020 but with little change for most owners

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Location coefficients will be updated this year. ASAVAL (Association of Professional Appraisers), the Association that represents real estate evaluators, recognises that the market has gained stability, but reminds the public that the coefficients have to continue to reflect the dynamics of the market. The last revision of the Location Coefficient occurred in 2015 and had an impact on tax assessments for 2016, 2017 and 2018.

Minimum long-term rental contract to be one year    

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New legislation stipulates that the minimum period for long-term rental agreements is one year and renewable for three years. According to the decree, “SIMA” (“Serviço de Injunção em Matéria de Arrendamento” – Lease Injunction Service)  will be created to strengthen tenants’ rights, namely for the reimbursement of improvements incurred by tenants.

Portugal with €130 billion in EU subsidies since 1986

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Since joining the European Union, Portugal has benefited from extensive economic support. According to the Bank of Portugal, Portugal has received a total of €130 billion since 1986 or ±2.5% of GDP per year. Portugal ranks amongst the highest among countries with EU subsidy allocations. Nevertheless, the movement of money is reciprocal. Portugal also sends funds to Europe: customs duties, agricultural charges, VAT and others. Between 1996-2018, annual transfers have been relatively constant at ±1% of GDP.