On August 25 of this year, the French and Portuguese finance ministers signed an amendment to their tax treaty to resolve the difficulties faced by French residents in Portugal when they receive public pay.
Please note: Retired public employees are not affected. This rider only concerns people working in the public sector.
French nationals residing in Portugal who receive public remuneration from France will now only be taxable in France and will no longer, as in the past, have to pay tax in both countries before making a request to eliminate double taxation. This is thanks to the signing on August 25, 2016 by France and Portugal of an amendment to the tax treaty that unites the two countries, dated January 14, 1971.
The purpose of this amendment is to facilitate administrative procedures. Income will now have to be declared in France.
This amendment also brings the bilateral agreement into line with the best standards in the fight against tax evasion and fraud.
The agreement will now include an updated information exchange mechanism, a new mechanism for assistance in the collection of tax claims, and an anti-abuse clause in line with theOECD to prevent the advantages of the agreement from being diverted from their objective by arrangements whose sole purpose is to avoid taxation.
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