Fiscal representation for non residents

On the 5th May 2011, the European Court of Justice ruled that Portugal can no longer force EU nationals to appoint a fiscal representative in Portugal, as this violates the rights of free
circulation of people and capital. However, individuals or companies who reside outside the EU must still appoint/ retain a fiscal representative.

Although the law in Portugal has not yet changed, the tax departments are altering their systems so that EU nationals who need a fiscal number can choose either to appoint a fiscal
representative or opt to register themselves directly with the tax department giving their home country address.

In order to cancel your existing fiscal representative you must go personally to the tax department to deal with the cancelation and to register your home country address. However,
in this interim period you should note that, whilst on your tax file you will have given your home address, any mail from the local tax department will initially be sent to the Lisbon
central tax office and from there it is unclear if it will be sent on to you. Anyone cancelling their current fiscal representative will automatically have the Lisbon tax office appointed
instead, although we do not know if this is a temporary measure or not.

As the law stands, if an individual or company does not have a representative they lose the right to receive tax department notifications – we do not know if or how this will affect clients
who do not appoint a representative.

With the tax department notifications and tax demands having strict deadlines, Sovereign believes it is unwise, at this stage, to cancel your fiscal representative until clearer measures
are in place and it is guaranteed that your correspondence will be posted abroad. Failure to reply to notifications can lead to large fines, and interest and penalties are applied to any tax bills paid after the deadlines all of which can place your property at risk.

Sovereign will continue to represent you and to keep you informed of any fiscal matters that could affect you, your taxes or your property. Should you decide to cancel your fiscal
representation, all outstanding fees will have to be settled and your file will be closed once we have confirmation from the tax department that we are no longer appointed.

Please do not hesitate to contact us for further clarification.

Whilst every effort has been made to ensure that the details contained herein are correct and up-to-date, this information does not constitute legal or other professional advice. We do not accept any responsibility, legal or otherwise, for any error or omission.

20.06.2011
Sovereign - Consultoria Lda.
Parque Empresarial Algarve, Lote 8, Porta 21
8400-431 Lagoa
Portugal
Tel: +351 282 340 480
Fax: +351 282 342 259
www.SovereignGroup.com/portugal