The importance of NIF: yes, you really need it
If born in Portugal, every baby already has NIF in Portugal. The person keeps it until death – and almost nothing works here without a tax number. Most Portuguese know their tax number by heart. You must also show your Portuguese tax number for transactions and contracts, large purchases, etc. – that is a rule, and without this tax number, you cannot carry out many business transactions.
Applying is very easy by going to any tax office or to a citizens’ office Loja da Cidadão. You need to bring a valid passport/identity card (validity period of at least one year). However, there are a few important things to consider:
- If you are still registered in another country and want it to stay that way, even if you have a holiday house in Portugal, during registration with tax office you should provide your native country’s residential address as it is written on the ID card.
- If you provide your Portuguese address, you need proof that you live here in the form of a rental contract, land register entry or telephone electricity bill, and the like. In these cases, you are automatically taxable to 100% of your world income in Portugal. With your previous home address, the tax liability remains in your native country. It is possible to change the tax address in the tax office at any time. Since this minor registration can have serious consequences, it is strongly advisable to discuss your situation with a lawyer or tax advisor beforehand. Nowadays, plenty of companies help non-experienced people cope with all the bureaucracy.
The tax number (NIF), i.e., the 9-digit number, will be assigned immediately, and you will receive a copy of the registration after payment of about 15 €. This is your NIF, your official document from now on. You should always carry a copy of this document with you because this number is needed regularly. Without numero de Contribulinte, almost nothing works in Portugal.
The indication of the tax address is not something you can choose or not choose. If you live in an EU country for more than 183 days, you must register there, and then 100% of your world income is taxable there. The double taxation agreement may also apply.
The famous 183 days
You cannot prevent your tax liability by not applying for the CRUE. The tax liability arises automatically with the expiry of the 183 days. You should always note that non-compliance with this obligation is tax evasion (attention: it is a criminal offense). Should it somehow come out, you must repay the tax, and the tax paid in your initial country of residence will NOT be credited, as you should not have paid it there. In addition, of course, there are penalties in the form of fines and, if necessary, even imprisonment (usually, this preventive measure is used only for large amounts). In any case, you have a criminal record afterward. Nobody wants it, right? And the actual double payment plus penalty can lead to the entire income being gone. Not to face problems of this type, it is better to choose a professional company that will assist you throughout the path. If you choose experienced specialists, be sure everything will run smoothly.