The company is split into two divisions: the Miami-based law firm serves to help expats through the long and complicated process of setting up their finances to avoid the costly pitfalls of double taxation, while the Lisbon-based consulting agency provides educational resources for individuals and institutions alike to get a grasp on how everything works and how to manage it.

The root of the matter is that the United States is one of just two countries in the world to tax citizens living abroad. “If you’re an American citizen or green card holder, you will continue to file US taxes, and once you’re a Portuguese tax resident, you will file Portuguese taxes. So, you start being double taxed”, Sasha Young da Silva, Areia Global Consulting’s Managing Partner, told The Portugal News. “We’ve got a couple of tax treaties between the US and Portugal that give us mechanisms to try and alleviate some of that double tax, but it’s not like you opt into one or the other. You’re looking at tax on worldwide income by both jurisdictions, and then we credit, exempt, and deduct from there”.

Transatlantic business

Originally from Aruba, Sasha moved to Portugal in 2020. “I felt like, as an American in Portugal at the time, there were very few resources about how I could do estate planning”, she recounted, “and if there are no resources that speak to this that I can find with access to all the legal databases and case law, all the insiders and network and legal training, then how are other people doing this? So that’s what I set out to do: estate planning for Americans. And estate planning, of course, is largely driven by tax, so it became estate and tax planning”.

As her legal practice expanded, she took notice of how this wide knowledge gap affected the ease of doing transatlantic business. “There was suddenly this exodus of Americans coming here, not realising they found themselves in really tricky tax situations, and Portuguese entities would say that’s not really for themselves to know, then run into compliance issues”, she mentioned.

Tax compliance is a serious subject, and failing to file properly can have significant consequences, with fines ranging from $10,000 to $50,000 a year. “The rules that apply weren’t drafted with American expats in mind, so they can lead to expensive mistakes that are easy to fall into. The lawmakers were thinking of people funding wars through offshore accounts. They’re not thinking of 'little old me' at Novobanco, they’re concerned about a drug cartel”, Sasha explained. “And then for Portuguese entities, whether they’re banks, funds, or companies, the risks are different. It’s a lot about reputation and enforcement. They want happy investors, but there are lots of risks that they easily fall into because they don’t know the US rules apply to them”.

Therefore, Sasha’s job is to provide the resources needed to educate the ever-growing number of Portuguese banks, companies, and American individuals, investors, and business owners on these risks and how to avoid them. “Americans are very entrepreneurial, and in the Portuguese market there are a lot of opportunities for Americans to start things that we have in the State and not here, but owning businesses overseas has a lot of tax implications, and a lot of reporting and compliance requirements”, she stated. “Then on the international side, we support funds that have US investors, so foundations, charities, trusts that invest into some of the bigger Portuguese funds, and they’ve got reporting and compliance related to that.”

Introductory source

Areias Global Consulting offers a series of masterclasses and papers on its website, acting as an introductory source for this complex field of research. Many Americans looking to move to Portugal come to the company with basic questions before committing to hiring legal or tax services, and so every month, it holds a free event called Café + Taxes, where people can direct their light inquiries.

“I think this is a really unique opportunity to be here at this time because Portugal is experiencing such massive growth so quickly while we’re having this almost technological revolution”, she concluded. “The US tax authority, the Portuguese tax authority, and the banking systems are all connected, so it’s a unique opportunity to weigh in on changes and considerations. I’m grateful, I like the challenge.”

Whether you’re interested in moving to Portugal or just looking for some tax advice, make sure to contact https://www.areiaglobalconsultants.com/