Banking and Bureaucracy in Portugal

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Despite the arrival of some glorious weather, it’s been a bit of an unsettled period for us here in the Algarve.

Unsurprisingly, this jittery period has corresponded with the need to deal with more bureaucracy. This time the issues are dealing with tax returns and attempting to get finance for a car. It seems like the lead time for any accountant, tax department or financial institution to answer an email or return a call is somewhere between 3 weeks and never, and at least twice a week at the moment we are brought to the point of wanting to scream with frustration.

This all culminated in us feeling homesick for England for the first time in months last week. The car was the first thing that started us off. Cars here in Portugal are extremely expensive, and you don’t have the option of getting something perfectly decent for a few grand like you do in the UK. Sure, there ARE cars for a few grand, but you are looking at the same kind of selection you would get for £500 in the back of the Autotrader. As a result, various firms who offer car hire in Portugal have been doing rather well from us since we moved here, as we have deliberated about what to do.

We were of the impression that we wouldn’t be able to get finance here until we complete our first tax return, but our bank said it should be OK, as they can get our income certified in the UK. Obviously this was exciting news, and we went straight off and found a perfect little car, just a year old with 9000kms on the clock.

Portugal Banking - Computer Says "Shrug"
Portugal Banking – Computer Says “Shrug”

This was three weeks ago. We were promised the paperwork would be done in two days. After calling every day for a week and being told “amanha” (tomorrow,) we were then told it could be 3 more weeks. “And then will we know about the car finance?” we asked. “Oh no, the 3 weeks is for the paperwork from the UK.” Oh, brilliant. “So how much longer for the finance?” says my wife, exasperation and rage filling the apartment. “Oh, it could be 3 days, perhaps a week or two….”

I have no doubt that a few miles down the road, in our bank, the lady on the telephone was performing what we call “the Portuguese shrug,” – widely practiced in Portuguese banks and government departments, and often accompanied with a shake of the head, a glance at the computer and the uttering of “it’s not normal..”

Needless to say, shortly afterwards the lady from Toyota phoned to say someone else has come and purchased “our” car. Approximately ten more working days have elapsed since all of this. Have we heard a word from the bank? What do you think?

Tax returns are similarly frustrating, and I’m going to refrain from going into too much detail, as I fear that if I have to relive it all again, people in the Tavira area will end up hearing a crazed English person screaming “WHAT MORE DO YOU WANT FROM ME?!” from a sunny roof terrace. Suffice to say, even having persuaded UK HMRC successfully not to tax us, it seems Portugal still want forms from England that DON’T EXIST to prove what we’ve earned, before they will let us give them thousands and thousands of euros.

When we first moved here, we were really surprised by the fact that all the expats we met said things like, “ooh no, don’t get residencia, just stay under the radar,” and “paying tax here? why would you want to do that?”

Our answer was, and always will be, that we want to live here long term, and want to do right by the country we live in. I also want the peace of mind of knowing we are doing things the correct way–even if that does mean our tax liability is a little more than it would have been in England. Trying to explain this to accountants here results in looks of bafflement. It seems we are the first expats with this desire to go “legit.”

So, there’s a (very much abridged) summary of why we have had that “fish out of water” feeling a bit recently. It’s not helped by the fact we both have a huge amount of work on and are often finding ourselves still typing away at 8pm, then grabbing a late takeaway and eating unhealthy food we don’t really want. That’s rather too much like what we moved from London to get away from. We need to regroup and reprioritize and, most importantly, we need a holiday—we have found out recently that living in a holiday destination doesn’t change that occasional desperate need to get away. On the bright side though, it’s taken 18 months for us to feel that way – in London it used to take six weeks.

Back next week, with (hopefully) a more cheery outlook 🙂

Image credit: Niklas

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11 Comments - Write a Comment

  1. Kindred spirit!
    1. Bought apartment in Cabanas but after two years had had no council bill for “rates”. Wanted to do right and told council. Had to pay back-dated rates that apparently the apartment builder had been paying (for no apparent reason). We then got fined for not paying rates!

    2. Some months later realised our (bent?) Portuguese solicitor had put only two thirds of the price of the apartment on the deed (used to be standard practice to put on a smaller amount, but not usually that much smaller!). Wanted to do right and get it changed. Understood we would have to pay the tax difference. Bill for the difference sent to apartment while we were back in England. We were then fined for not paying this in time!

    3. We would like to get a licence to rent out the apartment, but most people don’t bother and, as you say, “stay under the radar”. I wonder what are our chances of being fined again if we pursue the route towards getting a licence! Fairly high I would say judging from past experience. Everyone in Portugal is so helpful until they get behind a desk!

  2. That’s an uncharacteristically negative blog from you: makes quite depressing reading for someone who’s agonizing over whether to make the move or not. The car business in particular just seems to be a nightmare. I’ve read everything I can find on every blog around and no-one seems to have found a way through the mess of to import or not/ to pay rip-off Portuguese prices or not.

    But hey, thanks for telling it like it is. I look forward to your next epistle!

  3. Just as a matter of interest, I don’t know why my last post is timed at 2.03am. I’m not so sad that I read blogs on Portugal in the middle of the night – the time is just after 10am on a fine Spring day in England!

  4. Hi Hugh,

    I can’t quite decide whether it’s comforting or depressing that we’re not the only ones 😉

  5. Hi Nick

    I too thought it was uncharacteristically negative when I read it back, but telling it like it is is what I try to do–I don’t think it would help anyone to only present a rose-tinted picture!

    Guess what though? We got a call from the bank this morning saying paperwork is now “in order” and that we can go in and discuss the loan. Something exciting may be about to happen!

    Regarding the timings, my blog is hosted in the US, so I imagine that time is coming from the server it lives on. There’s probably a setting somewhere that I should change 😉


  6. Hi Ben,

    Trying to lift your spirit.
    Portugal está longe de ser perfeito, mas também se o fosse seria um aborrecimento. Não deixem que pequenas coisas vos desviem do vosso objectivo pincipal. O nosso país é assim, tem momentos que se adoram, outros que nos levam ao desespero.
    Meanwhile found what seems to be a nice restaurant for you. Never been there, but is in Tavira and the owner of the blog seems to enjoy it. Seems to be the typical restaurant close to the beach where you can enjoy a nice fish meal.

    hope everything is fine now.

  7. Hi Ben!

    Hope now you are already in a better mood than when you wrote this post. 🙂

    Just a remak though: remember than many of the problems and hassles you are encountering aren’t exactly due to Portugal’s burocracy fault, but more due to your unusual situation (of working and having your pay in the UK and declaring it in Portugal). And, as you have experienced, british authorities aren’t capable of handling this subject well and hastilly either.

    I’il just leave you with a funny quote from this portuguese guy I know who went to study in the UK. After a few weeks of dealing with the british bureaucracy he told: “I’il never complain about portuguese bureaucracy again!”. :p

    Regards, and hope your mood has improved in the last days! 🙂

  8. Hi CcoR –

    Thank you for your kind words, which hopefully you will see from my next post I have tried to take on board. Thanks also for the restaurant recommendation, which is near to where my in laws live. We will check it out some day soon.

    Best wishes

  9. Hi Anonimous!
    Hopefully you will see from my next post that my mood has indeed improved somewhat!

  10. What do you want more ?
    Fabulous weather ,excellent food and wine for almost nothing and SPACE !
    (missing the M-25 , are you ? )

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