Does Portugal have a tax treaty with the US?
Portugal has a tax treaty with the US that helps expats living in Portugal avoid double taxation in theory. Unfortunately, there’s a clause that authorizes the US to act as if that treaty doesn’t exist. It’s called the Savings Clause (but doesn’t do much saving!).
Where can I find the tax treaty documents?
The complete texts of the following tax treaty documents are available in Adobe PDF format. If you have problems opening the pdf document or viewing pages, download the latest version of Adobe Acrobat Reader. For further information on tax treaties refer also to the Treasury Department's Tax Treaty Documents page.
Does Portugal tax dividends?
In a nutshell, using a basic example: If a Portugal company pays dividends to a resident of the United States, the US can tax that income. Portugal may also tax the dividend, but if the beneficial owner of the dividend resides in the other state (US), then the tax that Portugal charges is limited.
Do tax treaties have a saving clause?
But tax treaties can be very complicated to analyze and evaluate — especially in light of the fact their tax treaties involve a saving clause — which essentially provides the IRS carte blanche to take the position they want on the articles of the treaty impacted by the saving clause (not all articles are impacted by the saving clause).