We’ll forgive you for saying you’ve lost track of what’s happening with Brexit - even those paid to understand it are somewhat confused! No-one is quite sure what exactly life will look like post-Brexit, especially for British expats living overseas. Let’s have a look at what we know about the future of Brits living in Portugal after 31st January.
The transition period
Good news - the agreed Brexit deal includes a transition period which is an agreement basically keeping relations between the EU and the UK as they are now. It comes into effect immediately upon the UK leaving the EU and will run until December 2020 and could be extended. Before this date, it is advisable to have all the necessary residency paperwork you need for living in Portugal sorted to minimise potential problems.
Pensions and National Insurance
If you are a UK national living in an EU country such as Portugal, you will continue to receive your state pension post-Brexit. The British government has also confirmed that expats will still receive the annual state pension increase after the UK leaves the EU: that’s the plan anyway! There will also be a social security agreement between the UK and Portugal regarding National Insurance contributions that you make while living in Portugal and it states that these contributions will also continue to count towards your UK state pension.
If you are considered a resident in Portugal, this means you are entitled to access the state healthcare system and these rights won't change in Portugal after Brexit, providing you remain a resident of the country. If you’re a British citizen just visiting Portugal, it has been stated that you’ll still be able to access state healthcare if you present a valid UK passport until the end of the transition period, or until a further arrangement is reached between the governments in the UK and in Portugal.
The post-Brexit property market
If you, just like many other Brits, have chosen to make Portugal your home, this could include buying or investing in property or even having a holiday home in the Algarve. In this case, it is vital to to make sure you are paying the right taxes, especially after Brexit comes into force. If you spend more than 183 days in Portugal within a 12-month period, the government considers you as a ‘tax resident’ and your income is taxable in Portugal. The most important thing you need is a Portuguese tax number (Número de Contribuinte /NIF) to pay your taxes, as well as to do other useful things such as buy a property or a car, open a bank account or sign long-term rental contracts. You can get this number, via a fairly simple process, from the local tax office in Portugal (known in Portuguese as “Finanças”) and must do so before the end of the transition period.
As we hear a lot on the news and in the papers, no-one really knows what the real outcomes and repercussions of Brexit will be. Brexit news can also change dramatically from one day to the next, so keep watching this space for news on how Brexit will affect British expats living in Portugal.