Portuguese property

08 May 2012

Issue: 4352 / Categories: Forum & Feedback

A Portuguese company owns land in Portugal on which it has built a villa. Some time ago, the company’s domicile was changed to Malta for tax reasons, although UK corporation tax returns are submitted as ‘central management and control’ are in the UK

Several years ago my client purchased a Portuguese company which owned a plot of land in Portugal. Shortly after purchase of the company a luxurious villa was built on the site with all expenditure being accounted for as the company’s.

The company’s domicile was changed some time ago to Malta because of changes to Portuguese tax which would have affected it if it had remained domiciled in Portugal.

As a result the company’s accounts have been audited annually in Malta as required under Maltese company law.

There is some letting of the property as a holiday let (although not enough to qualify as a furnished holiday letting) through the Portuguese property managers but the property is mainly used by my client and his family.

Appropriate tax returns are made in Portugal and Malta. However because the company’s shareholders and directors are UK residents (i.e....

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