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Posted Wed, 10 Jan 2024 09:20:19 GMT by Ailsa Lord
I have been a resident of Portugal since Jan 23 with no income generated in UK since Dec 22, no pension or rental income. I have been offered contract work in UK for a max 5months where I will be physically working in UK for UK company. Will I be required to pay tax (paye) in UK and declare income to Portugal under DT treaty or can I apply for NT tax code? I have no other ties in UK under tax residency rules. Is it better to set up UK company & pay myself a dividend? I want to make sure I am on the right side of tax rules both UK & Portugal and pay taxes where due. I am a UK citizen.
Posted Tue, 16 Jan 2024 12:14:15 GMT by HMRC Admin 21 Response
Hi Alisa,
Please have a look at article 15 of the UK / Portugal tax treaty (UK/PORTUGAL INCOME TAX CONVENTION SIGNED 27 MARCH 1968).  It advises that your employment in the UK is taxable in the UK, while you are in the UK carrying out that employment.  You will be entitled to personal allowances to set against the income.  You would complete a P46 when commencing your employment.  Portugal can also tax this employment, so you would have to claim a credit for any UK tax payable.
Thank you.

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