Can my friend be my fiscal representative?
Corporate owners must have a VAT registered fiscal representative but for individuals, if their friend lives in Portugal, and are bona fide tax residents, then in theory the answer is yes, but it is highly inadvisable.
Many ask why they need to pay an annual fee for a fiscal representative when a Portuguese resident friend could register as the representative.
The fiscal representative is the interface between the individual and the tax department, being the first point of contact for all fiscal matters and is jointly responsible with the client for any tax calculations relating to the property or individual taxes. So, do you want your friend as your fiscal representative to become liable for your tax debts and risk losing their assets? Do you want them to know all your private fiscal business?
Owing to the increasing complexities and demands of the tax department it is advisable to appoint a professional firm to avoid costly tax mistakes. Will your friend or neighbour be able to deal with the tax letters informing you about re-valuations, audits, tax refunds? Will they be able to make appeals on your behalf against taxes or fines? Can they prepare and submit your rental income tax return to your best advantage? Is your friend aware of the ever changing fiscal laws to be able to keep you informed about matters that could affect you?
Most tax department notifications give 10 days for the submission of documents for audits and appeals. If the friend is absent and the letter sits in a post box it is you that will incur fines and possibly increased tax bills?
Non payment of taxes can put your property at risk as the tax department will instigate proceedings to sell the property for debt recovery – even for amounts under 100 euros!
Contact us for more information:
Sovereign - Consultoria Lda
Parque Empresarial Algarve
8400 Lagoa
Portugal
Tel: +351 282 340 480 Fax: +351 282 342 259
