Information regarding pension drawdown in Portugal?

Expert Info

on 30 Sep 2016

Hi We have recently been looking at buying a property in Spain but have been put off slightly by the cost of legal fees etc We have just heard that if we moved to Portugal and became residents I could take my drawdown pension without incurring any tax costs, needless to say this has drawn our attention to Portugal. Can anyone give me any information on this and confirm that it is as good as it seems. Regards Jon

Anonymous (not verified) on 5 Oct 2016 - 14:04

Hi Jon. I'm no expert on this but just found this article which may be of interest. Sounds like there are potential pension benefits of moving to Portugal or Spain.

Changes to the rules a couple of years ago mean that you may be able take your hard-earned savings with you if you move abroad - and possibly escape some of the taxes that would otherwise apply here in Britain. If you move to Portugal you may be able to take your UK pension and pay no tax on it for the first 10 years. This applies even if you withdraw large sums, a move which in the UK could attract high tax charges, as such withdrawals are treated and taxed as ordinary income. To benefit from these rules, retired people would have to plan the move carefully and make sure they meet strict residence criteria both in Britain and Portugal. And advice from an (honest) professional who has experience with the taxation laws in Portugal is very important.

Source:
http://www.telegraph.co.uk/finance/personalfinance/special-reports/11519095/The-ultimate-pension-freedom-Retire-in-Portugal-and-reduce-your-tax.html

The article was written in 2015, so is a little out of date now. I'm not sure if us leaving the EU will make much difference, but clearly the 10% drop in the pound will make a property in Portugal more expensive.

Anonymous (not verified) on 5 Oct 2016 - 14:06

And more here:

In an effort to attract wealthy foreigners to its shores, Portugal is promising they won't have to pay tax on their non-Portuguese income for a decade.

Source:
http://citywire.co.uk/money/retire-abroad-the-country-offering-tax-free-pensions/a830819

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