ASAE and tax authorities will strengthen the investigation activity in properties as the owners start to be obligate to have a license of the Tourism of Portugal.
This inspections are going to be strengthened in the Algarve starting in this summer.
The Portuguese Government is currently preparing a new pack of rules that forces the owners to register in the public finances, concerning of short term renting of holiday houses. Portuguese newspaper Jornal de Negócios and Correio da Manhã reported this article, this Tuesday.
According to Jornal de Negócios, the Government is preparing the creation a new national register of rental licence, where the owners must register every properties that the tourist rented for holidays. However, disregarding should dictate a forced closure of the property.
Under this registry plan, all owners would have to open commertial activity on public finances through a specific economic activity code and, before that, to license the property at Tourism of Portugal.
In particular, this measures concern essentially on apartments and dwelling houses that are rented for tourism through the internet (of international companies that don´t pay taxes in Portugal), who rent doesn´t pass receipt, neither declares the gotten incomes.
The Portuguese newspaper Correio da Manhã writes that the Tourism of Portugal will cross information with the Tax Authority and will be applied methods of inspection that will go to through an inspection of the receipts of water and electricity and various websites of temporary renting. The purpose of Portuguese Government is to combat the unfair trade competition to the hotel chains.
The inspection will get strengthen right way, in this year, in Algarve, Correio da Manhã yet cites, that the secretary for Fiscal affairs, Paulo Núncio, wants to aggravate the penalties for legal infraction in this sector and create additional penalties for the owners of properties, caught in disregarding.
A set of news that appeals to the hotel industry. “This activity should be regulated, since the law has been overtaken by the exponential increase in supply,” said the president of the general council of the Association of Hospitality Portugal, Luís Veiga, quoted by the Jornal de Negócios. In Publico
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Hi Carlos,
Thank you for circulating the notification on changes to renting property. For your information here is my opinion.
We were warned of these moves by our accountant in Portugal – Sovereign. We rent our villa (16B on Clube Golfemar). We have an AOL license and declare our income and expenditure supported by recognized IVA receipts. It does seem that the Portugal government is making it more and more difficult for small owners like ourselves to rent. For example this year we were instructed by Sovereign that we could not claim the cost of maid and laundry services even though the services are provided by a company and supported with formal IVA receipts. These costs were wholly incurred for the purpose of providing services to clients. What is more we are not allowed to claim for utility usage during client visits which can be expensive if they run the air conditioning units (we record the meter readings before and after each visit).
As a result of these changes our IRS tax bill has increased substantially.
June (my wife) and I are not seriously considering not renting which will be a shame. We work hard to offer a good service to clients which benefits the Portuguese economy in that:
1) We provide employment for maid services
2) We pay IVA on all supplier invoices
3) We pay tax on any profit to the Portuguese government(and then pay tax again on any remainder profit to the UK government)
4) We attract overseas visitors to the Algarve which benefits the local economy
I know we are a very small micro element in the local economy but if you multiply these factors by the number of small rental properties it becomes a serious issue. In my opinion the moves of the Portuguese government will have a long term detrimental impact on the economy.
Regards
Stephen