Portuguese Tax Returns: IRS Annex B (Self Employed Income)
If you earn income from renting out your holiday home in Portugal, you are required to declare your income to the Portuguese tax authorities. This means filing a Portuguese tax return each year.
To find out how to fill in the cover sheet, click here.
Below is a step by step guide to filling out Annex B (Self Employed Income) under the Simplified Regime:
Section 1
Select field 01 (Simplified Regime) and the nature of income.
Section 2
Confirm the tax year you are declaring your income under.
Section 3
Enter your NIF (subject A) and the NIF of your spouse (taxable person B), if applicable.
Select 'no' in field 06 (your self employed income is not from undivided inheritance).
In field 07 you must enter the code of the activity table art. 151 of the CIRS. Enter CAE 55201 (Furnished accommodation for tourists) or 55204 (other places of short-term lodging). This information can be found on your ‘Declaração de Início de Actividade’ document).
In question 3B select 'yes' (you have a permanent establishment - this applies to all taxable persons, whether resident in Portuguese territory or not).
Section 4
Enter your GROSS holiday rental income in field 417, 'Prestações de serviços de atividades de exploração de estabelecimentos de alojamento local na modalidade de moradia ou apartamento'.
Section 5
This only applies if you have earned income from just one person or entity. In this case you can opt to follow the taxation rules of category A (PAYE/dependant workers).
Section 6
Enter your GROSS holiday let income again in field 601.
Section 7
Business expenses. Under the simplified scheme, expenditure is not taken into account and there is no possibility of deducting expenses. Instead, 25% of income is automatically considered expenditure.
Section 8
This only applies if you have disposed of any real estate. If you tick these fields you have to identify the buildings and their respective values.
Section 9
Enter information regarding capital gains, if any.
Section 10
This section only applies if there has been a transfer of shares before five years have elapsed since the transfer of assets and/or loss of the status of resident in Portuguese territory.
Section 11
This deals with inheritance and is unlikely to apply in most cases.
Section 12
This only applies if you have organised accounts as opposed to the Simplified Regime. (Organised accounts means you pay a Portuguese accountant, registered with the proper authorities to do your taxes for you - mandatory for incorporated companies and individuals who earn more than € 200,000.00).
Section 13
Question 13A only applies if you receive any subsidies.
In Table 13B, insert again your GROSS income declared in section 4, as well as the values declared in the last two years.
Section 14
If you have ceased your business activity select field 01 and enter the date that the activity ceased in field 03. If not, select field 02.
Indicate also whether there was any transfer of assets that affected the exercise of your business activity; yes (field 04) or no (field 05).
If you have not earned any income from your holiday let, indicate this in field 06.
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