Can a British Tax Payer buy and sell a property in Portugal, as an agent or in trust for another non-British person or BVI company, removing the tax liability from themselves and onto the beneficiary?
What additional questions do you have?
Hello Sean... Sorry I was cut off.
My further question is that if I have an appointment as an agent and an attorney to the client to buy and sell the property in portugal then I should not be liable for the tax on the benefit
The only thing is that I did not decalre the arrangement to the land registry at the time of purchase or sale, I only brought the arrangement up when it came to the tax return upon the sale of the property
I have presented the documents as follows
"My further question is that if I have an appointment as an agent and an attorney to the client to buy and sell the property in portugal then I should not be liable for the tax on the benefit" - This is correct. Assuming you are not acting as "principal" or on your own account.
1- appointment as agent/trustee and attorney/ the bank transfer of funds from the company i was representing 3- the sale of the property and the proceeds back to the company and not me
Are you talking about the UK Land Registry or the Poruguese Land Registry?
The Portuguese authorities are not accepting my documents as there was no mention of the arrangement at the time of purchase or sale, and the purchase was made in my name.... this is quite different to the UK tax laws that recognises trust documents and agents as nominees even if they are not registered as such in land registry
I agree - unfortunately I can only advise you on UK law.
So do you mean the the tax authorities in Portugal or the land registry in Portgual aren't accepting your documents?
The portuguese are chasing me for a tax is that is not mine and not accepting the arrangement I had with the company that i was representing, ...
yes the tax authorities are are not accepting my documents
even though I'm happy to act as an agent between them and the company to retrieve the tax accordingly
From an English law perspective it would appear you are acting as agent, but from a Portuguese perspective I really wouldn't know.
My argument is if the liability is not mine (as per the arrangement and appointment) then why should I be liable?... the tax should be paid by the company
I understand, but the tax law in the UK and the tax law in Portugal are two entirely separate things.
its the UK HMRC acting for Portugal under MARD that are chasing me
and how is it that they are not "accepting" your documents - what have they said?
but not under my tax return or tax ID in the UK
They have said that if Portugal is not accepting your case then we will collect from you
and they will make an order of possession of goods if I do not pay
clearly the UK should accept fair play
You really need to ascertain the position under Portuguese law
if I was liable for the tax then I should've made such a declaration on my tax return
What about the person you were acting for - can you not obtain the tax from them to pay over?
But it is your contention that you are not liable - so that is a circular argument.
yes I can get a form of liability from them... however I would need Portugal to agree and recognise such a form
yes its a circular argument
Can you just obtain the actual money from them and just pay it over
if i obtain the money then I am admitting that the transaction was mine and I benefitted when in fact I did not
and secondly it would make my tax return for that year in the UK false
this is a two part argument
1. the liability is not mine
2. the liability should be paid by the company
Yes, but at the end of the day they just want their money - they are the same as any other person/business in that regard. If you obtain the money from the principal and say "without prejudice" to your position you are paying tax on behalf of your principal - then I'm 99% certain they will accept that
Check with HMRC but I would present that to them as a reasonable way forward
Who are you dealing with there? Which team?
I agree with you however it will require for the Portuguese to accept that i am receiving the tax money from the company and the HMRC to acknowledge without prejudice that I am acting as an agent in this transaction and the payment of the liability
Yes - but im sure HMRC can agree that on their behalf
A team out of Lagos
the Taxation office of Lagos
A hmrc team in lagos?
no HMRC MARD in Bradford
and the local taxation office in Lagos
If HMRC are getting involved then communicate with them in the first instance. Write them a letter and state your proposal, make sure the letter is marked "without prejudice" and send it special delivery. Ask for a response within 5 working days. If they cannot or will not agree to propose the position to the Portuguese then make the same offer direct to the Portuguese local tax office. I would say at the bottom something like "Should you not accept this offer then I do not see any other option but to commence litigation."
Can I make a petition in the courts in Portugal to have the liability moved from me too the company I was representing ?
That is a Portuguese question im afraid
Hummm... Thats what I was hoping for here... I pretty much knew the British answer to the position in terms of how the HMRC would look at this
I can only advise on UK law I'm afraid
OK!... do you have a Portuguese counterpart or someone in portugal who can assist?
No I don't - I could find you a Portuguese lawyer but aside from that there is little else I can advise
I will be grateful for any help that you can offer... Many Thanks, ***** ***** been helpful and re-enforced many of the arguments
I think when I put names in here it gets starred out so try going to http://www.garrigues.com/en/RedDeOficinas/Paginas/lisboa.aspx
I've used Garrigues before (albeit for a Spanish law question) and they were very professional. It could mean their fees are not cheap though...
Best of luck.