In an order dated 30 April, the Assistant Secretary of State for Tax Affairs, António Mendonça Mendes, revoked another order signed by himself just four months ago, which imposed the deadline until June 30, 2021.
The designation of a tax representative is mandatory for all holders of a Tax Identification Number (TIN) residing in countries outside the European Union (EU), which is effectively the case in the United Kingdom since January, after the post-Brexit transitional period.
In addition to the estimated 400,000 Portuguese residents in the United Kingdom, including minors, the Portuguese Chamber of Commerce in the United Kingdom estimates that up to 15,000 British owners of a second home in Portugal may be affected.
However, even subject to a fine of up to €7,500, the Secretary of State himself admits “there are still a large number of taxpayers who have not complied with this legal obligation”.
In this new resolution, Mendonça Mendes determines that the appointment of a fiscal representative can be made “without any penalty” until June 30, 2022 and that those who have not yet done so can maintain their current address until the new term.
This tolerance does not apply to new registrations or the beginning of activity in Portugal by residents abroad, who continue to have to appoint a tax representative, considered the point of contact between the tax administration and the taxpayer.
The order published also states that the project to digitize the notifications from the Tax and Customs Authority (AT), known as the electronic notification system, should be concluded “during the course of the year 2022”.
At that time, he says, “the system, operating only electronically, will allow taxpayers with Portuguese TIN who reside abroad to be exempt from the obligation to designate a tax representative”.
This system will work in conjunction with Morada Única Digital, which has been happening since 2019 for the remaining Portuguese taxpayers residing in the national territory.
The measure satisfies the concerns of the Portuguese community in the United Kingdom and the appeals of both PS and PSD, which alerted the Government to the problem, namely the fact that the deadline is short and there is a lack of information.
However, it may have arrived late for many people who in the meantime turned to lawyers and other professionals to issue the necessary powers of attorney and hire the tax representation service, whose annual cost can reach up to €750.