You think its only Italy, think again

PORTUGUESE TAX HIKES

In line with several other countries in Europe facing significant fiscal deficits after the
financial crisis, Portugal has introduced a number of tax increases which particularly
affect the more affluent parts of the country’s population, including expatriates
resident there.


In addition to a new top rate of income tax of 46.5%, charged on income over €153,300, which was introduced for income received from 1st January 2011, a solidarity tax of an additional 2.5% will be imposed on income received in 2012 and 2013 that exceeds €153,300, giving an effective top rate of income tax of 49%.

This follows the Portuguese government’s imposition of a one-off tax charge of 3.5% on all taxable income (including investment income) received in 2011.

Savings and investment returns are also being targeted with the fixed rate of tax applied to interest and investment income increasing from 20% to 25% from 1st January 2012. Where interest income arises in a tax haven, such as the Channel Islands or the Isle of Man, interest will be taxed at 30%.

The emphasis now clearly on transparent locally compliant life assurance bonds.