Info as publiced in AFPOP magazine April issue.
Recently there have been many press articles on the subject of Letting Licences and many members affected by the issue are in a panic. Because of the lack of coordination between Inspectors, Tourist Office and Câmaras, many owners rightfully fear a Catch 22. Members have asked what to do in their particular area; what the law actually says and how it affects their particular circumstances. Obviously individual situations must be judged on their circumstances, but basically if you earn income from renting out property in Portugal, that property must be licensed. There are different types of licences, based on size, number of rooms and frequency and type of occupation, but all property must be registered with the Câmara and licensed accordingly.
We asked Dennis Swing Greene of euroFinesco for an assessment of the financial implications of the licensing issue. Dennis told us, “Despite the shortcomings regarding implementation, the vast majority of people are not faced with disaster but rather an opportunity to put things right. In fact, most will eventually be better off than before. For example after a one-off expense for licensing, annual tax savings could be thousands of Euros each year. If you wish a mixed usage of your property, local regulations can offer a relatively simple and workable solution. Those people with relatively modest rental income can still be free from bureaucracy by remaining non-commercial and non-residents should have a “nil-cost” solution, recovering all Portuguese taxes and overheads in their home jurisdictions via deductions and tax credits.”
Are Câmaras ready?
One of the main complaints seems to be that members have been unable to obtain licences upon application, as their Câmara did not have any procedure in place to deal with enq