Question NHR Portugal and Georgia company

[ska]

Hello, I need some help
I'm in Georgia and I have a Small Status as Individual Entrepreneur: 1% of taxes up to €100k (I'm simplifying).
I will probably be employed by a casino multinational company in Lisbon. I would like to continue also with my freelance work.

20/30k income as a freelancer.
40/50k income as a employeer.

1) Option
To get 0% tax on salary I would need to ask the company to employ me through other company offices like Malta, Cyprus, UK, Guernsey. Which is the best option?


2) Option
If the don't agree on that (why shouldn't they do it in your opinion? How can I convince them) and they decide to employ me from Portugal company I would just get taxed %20 and I will continue as a freelancer with my small georgian company (just 1% taxes in Georgia).

3) Option
I ask them to work for them as a contractor (also here preferably from a foreign company) and I will invoice the work with my Georgian individual company.
Is it possible to get taxed 0% by Portugal this way?? I read that maybe this works just for EU companies...


I know NHR is just for passive income, but will Portugal investigate income from Georgia? It seems so unlikely to happen...

I'd love to hear your opinions on this complicated situation...

 

[orangekangaroo]

In which country will you do most of the work?

 

[JustAnotherNomad]

Will you be working in Portugal physically?
You should talk to a tax lawyer from Georgia.

 

[ska]

Yes, I will work from Portugal physically.
Thank you for your interest.

 

[JustAnotherNomad]

Money earned working for a Portuguese employer while being physically located in Portugal will be taxable in Portugal. You may also have to pay tax in Georgia on that income.
Your best option would be to talk to an accountant who understands the tax code in both countries as well as any applicable tax treaties, but I don't know if such a person exists.
In the absence of that, I'd try to find a good PT tax lawyer as well as a good Georgian tax lawyer.
But if the work is mostly carried out in PT, the PT side is more important.

 

[ska]

Yes, theoretically.
But I listed some options that maybe let me show portugese authorities that it's not a local income.
I don't want to know what's right (I know NHR is just for passive income), but what can work.

 

[JustAnotherNomad]

Yes, that's exactly why you should speak to a PT tax lawyer. Ideally one who handles a lot of NHR cases, as they usually have experience setting up structures that will work with the NHR system in practice (even if they shouldn't be working in theory).

As for your original question (I am not an expert, please double check with a lawyer):

1) I would suspect this will only work if there is a tax treaty in place between Georgia and Portugal AND you spend less than 183 days per year in Portugal.
It seems like there is a treaty, but will you be spending less than 183 days per year in Portugal, so that your tax residency can remain with Georgia?
If you spend more than 183 days per year in PT, I can't imagine being employed by a different office would help, it would only make things more complex.

2) The reason why they may not want to do that is that it will create more hassle for them.

3) This should probably work if there's a tax treaty between PT and GE (I believe there is one). But of course using a non-EU country is more exotic and may create additional attention from the tax authorities.
In theory, your GE company would also have to register for VAT due to services performed physically from PT, and then they could really start looking more closely. You can of course send invoices as if the work was performed from GE, but will they accept it?

Probably the lowest risk would be to invoice one of their other offices as a contractor. But I doubt they'd accept that, it's just too weird.

 

[ska]

Yes, that's exactly why you should speak to a PT tax lawyer. Ideally one who handles a lot of NHR cases, as they usually have experience setting up structures that will work with the NHR system in practice (even if they shouldn't be working in theory).

As for your original question (I am not an expert, please double check with a lawyer):

1) I would suspect this will only work if there is a tax treaty in place between Georgia and Portugal AND you spend less than 183 days per year in Portugal.
It seems like there is a treaty, but will you be spending less than 183 days per year in Portugal, so that your tax residency can remain with Georgia?
If you spend more than 183 days per year in PT, I can't imagine being employed by a different office would help, it would only make things more complex.

2) The reason why they may not want to do that is that it will create more hassle for them.

3) This should probably work if there's a tax treaty between PT and GE (I believe there is one). But of course using a non-EU country is more exotic and may create additional attention from the tax authorities.
In theory, your GE company would also have to register for VAT due to services performed physically from PT, and then they could really start looking more closely. You can of course send invoices as if the work was performed from GE, but will they accept it?

Probably the lowest risk would be to invoice one of their other offices as a contractor. But I doubt they'd accept that, it's just too weird.

No I will spend more than 183 days per year in Portugal.

Thank you for all your detailed replies!

Yeah, you're right, it's a little bit weird.

Maybe I can choose between different countries: Malta, UK, Cyprus, South Africa.
Which would be the best from a tax perspective?

40/50k income as a employeer in the selected country.
20/30k income as a freelancer with my Georgian small company (but I can open a new company of course).

 

[JustAnotherNomad]

Talk to a PT tax advisor.

I would guess that the best options would be in this order:

1. Don't get residency in PT, invoice non-PT office (preferred) or PT office (not ideal, but could still be ok) from a Georgian company (not freelancer, preferred) or freelancer (not ideal, but could still be ok), pay tax in Georgia as if you were living 183+ days in Georgia
2. Get NHR residency, invoice non-PT office (preferred) or PT office (risky) as a non-PT company (not freelancer, could be in Georgia or elsewhere), take dividends from your company
3. Don't get residency in PT, be employed by non-PT office as a Georgian resident or as a local resident working outside that country. Check the local rules - I believe even as a UK resident (!) working for a UK employer outside (!) the UK, you only pay 8% or so for social security and no tax. No idea about the other countries.

In any case there is always the risk someone will find out you're spending 183+ days in Portugal and then you're screwed. Using a company, an entity that is separate from you, may offer some additional protection, especially if you can show some substance. But you really should plan this well with a PT lawyer and not just hope no one will notice.