Police Pension tax concerns in Portugal (Porto)
Olá e bom dia da ensolarada Queensland na Austrália. Meu nome é Stephan McMurray (English from here on I'm still a work in progress)
I have been planning to relocate and buy a home and become a permanent resident in Portugal for several years now. I was a police officer and reserve soldier for 26 years in Sydney NSW.
I left the police force in Protected content of work related depression and PTSD; because of the nature of the work I did and this was classified as Hurt On Duty police pension of 75% of the wage I was on at the time. This money came from my superannuation and comes as a fortnightly pension. This pension will be paid to me for life now. I have paid tax on my income for 43 years and continued to pay tax on my pension after leaving the police for 21 years.
After leaving the police I also put myself through law school and became a barrister/lawyer. I now work as Principal Prosecutor/Investigator for our state in relation to prosecuting companies and employers where they have failed to protect workers from death or serious injury. I love Australia, but, I find the cost of living and the over regulation of everything is becoming a burden to the point that I could not retire and live on my police pension alone here until I am over 70. I made up my mind to live in Portugal. Whilst I will never be claiming a govt aged pension I would like to ensure that I am covered medically through the health system and also by obtaining private health insurance in Portugal.
To make things so much easier I am also an EU citizen and have my Irish Passport as well as Australian. I spent two months travelling through Portugal last year and fell in love with its, culture, food, music, natural beauty and above all its people and it felt more like home than I have felt my whole life in Australia. It may be because my mother has Portuguese back in her family history several generations past.
I love Porto (it is the best city I have ever seen) the Norte and central Portugal. I have decided that I want to live in Arcos De Valdevez or the Viana do Castelo region. I want to become part of the community in Portugal not an ex pat community.
I am ready to travel back there and look at some homes I wish to inspect and perhaps make an offer and finally move to Portugal but I've recently become concerned, that once I am a resident of Portugal they may try to tax my police pension (which will be my only income unless I commence working in Portugal). In Australia, now that I have turned 60, I no longer pay tax on this and I do not even have to declare it to our strict Australian Tax Agency as income based any more.
If I am taxed on this in Portugal it will be taxed at a rate of Protected content % and this will significantly impact my quality of life as it represents over a third of my pension which I have to live on for the rest of my life. So I am hoping that someone here can assist me with some real information or contacts regarding this issue. And very keen to hear from anyone who had similar issues and concerns and how they were resolved.
Warm and kind regards