Portugal IRS Filing Guide

Filing your Portugal IRS (Modelo 3) as an expat is not the same as filing as a Portuguese national with domestic income only. The moment you have foreign income — a UK pension, US Social Security, dividends from a brokerage account held abroad, or freelance revenue invoiced to clients outside Portugal — your filing becomes a cross-border exercise.

This service exists for residents of Portugal who have income from more than one country. It is designed for three groups. First, expats with employment income taxed at source in another jurisdiction and needing treaty relief claimed on the Portuguese return. Second, freelancers and remote workers who earn through recibos verdes (green receipts) but also have foreign investment income.

Third, US citizens and green card holders who may need to coordinate their Portuguese IRS return with their US federal filing. Taxbordr handles the Portuguese filing end-to-end. For US citizens, the firm also coordinates timing and treaty positions with your US preparer to ensure the two returns do not contradict each other.

Every filing engagement produces a founder-signed written document — the Position Memo — confirming the treaty positions applied. Telmo Ramos (Ordem dos Economistas Cédula No. 16379) personally reviews every return before submission.

Taxbordr offers two fixed-fee tiers for annual IRS filing. Fees are confirmed in writing before work begins. Portugal-Only Filing — €500 Covers the Modelo 3 submission for residents with Portuguese and foreign income, where all foreign income is sourced from a single jurisdiction. Includes Anexo J (foreign income annex) preparation, treaty relief analysis, and written confirmation of the tax position applied.

Suitable for most single-country expats — UK nationals with a pension and savings income, or EU nationals with a single employment contract abroad. Portugal + US Coordination — €1,300 Covers the Portuguese Modelo 3 plus coordination with your US tax preparer. Includes dual-filing timeline management (Portuguese deadline vs.

US April 15 / June 15 deadlines), treaty position alignment, FBAR awareness (the firm confirms which accounts require FBAR reporting but does not file the FBAR itself), and the Position Memo covering both jurisdictions. Designed for US citizens filing a Portuguese return who need both sides to match.

Both tiers include a follow-up review if Finanças (the Portuguese tax authority) queries the return.

Modelo 3 is the annual Portuguese personal income tax return, but expat complexity comes from annex mapping and cross-border consistency rather than the form shell itself. For most international profiles, filing quality depends on selecting the right annexes and tying every income stream to documentary evidence.

A robust pass includes employment/self-employment mapping, foreign income classification, and credit logic evidence before submission. Map each income stream to one annex and one source record. Reconcile declared totals to bank, payroll, or broker statements. Document foreign tax paid and treaty/credit assumptions before filing.

US taxpayers in Portugal should treat account reporting as a separate compliance layer from income reporting. The two most commonly confused filings are FBAR (FinCEN Form 114) and Form 8938 (FATCA), and they are not interchangeable. FBAR threshold: aggregate foreign account value above $10,000 at any point in the year.

Form 8938 thresholds for US persons abroad depend on filing status (for example, higher thresholds than domestic filers). This means a taxpayer can have an FBAR filing requirement without triggering Form 8938, or can trigger both.

The Portuguese return and the US account-reporting set should be reconciled as one package so account inventories, foreign-income declarations, and withholding evidence do not conflict across systems. Before filing season closes, run one cross-check table with account name, jurisdiction, peak balance, FBAR status, Form 8938 status, and related income lines in the Portuguese return.

This single control greatly reduces mismatch risk. The Modelo 3 is Portugal's annual personal income tax return. It covers all worldwide income for Portuguese tax residents — employment, self-employment, pensions, investments, rental income, and capital gains. For residents with only domestic income, the return is relatively straightforward. Complications begin with foreign income.

The Anexo J is the annex where all foreign-sourced income is declared. Each income type — dividends, interest, pensions, employment, rental — may need to be reported separately with the correct country code and treaty article reference. Errors in Anexo J are the single most common cause of incorrect assessments for expat filers. Treaty relief may need to be actively claimed on the return.

Portugal does not automatically apply treaty provisions. If you paid tax on a pension in the UK and the treaty allocates taxing rights to Portugal, you may need to claim the foreign tax credit on the Portuguese return yourself. Failure to claim results in double taxation — not because the treaty allows it, but because the return did not request relief.

For clients under NHR or IFICI, the regime election may need to be correctly reflected on the return. An NHR holder who fails to declare foreign income as exempt under the NHR provisions will be taxed at standard rates. The return itself is the mechanism for applying the regime.

For expats with foreign-source income, the Portuguese return may need to apply double-tax-relief logic with precision. Article 81 CIRS is the core mechanism used to eliminate international double taxation in many scenarios, but only when data is declared correctly by category and source country. Operationally, do not treat foreign tax as one global number.

Relief is assessed against the relevant Portuguese tax attributable to each foreign-income stream. If your supporting evidence is incomplete, relief may be restricted even when foreign tax was actually paid. A robust filing file should include: Income-by-country and income-by-category breakdown. Foreign tax evidence matching each stream. Treaty-position notes for each material income type.

Reconciliation between Anexo J entries and source documents. Where legal conditions are met, Article 81 also contains carry-forward mechanics in specific circumstances. That is why conservative categorization and documentation are critical before submission.

The process follows four steps. Each step has a defined timeline and deliverable.

1. Document collection (1–2 weeks). You provide income statements, tax certificates, bank statements for foreign accounts, and any prior-year returns. Taxbordr provides a checklist specific to your income profile.
2. Position Memo and return preparation (1–2 weeks).

Telmo Ramos reviews your income sources, applies the relevant treaty provisions, and prepares the draft Modelo 3. The Position Memo is drafted in parallel, documenting the treaty position for each income stream. Step 3 — Review and approval (2–3 days). You receive the draft return and Position Memo for review. Any questions are addressed before submission.

Step 4 — Submission and follow-up. The return is submitted electronically to Finanças. The Position Memo is finalised and signed. If Finanças queries the return, Taxbordr handles the response at no additional cost within the engagement scope. For ongoing cross-border tax services, the annual filing is included in the retainer engagement.