Abstract
Abstract The Portuguese perspective on Trusts is very much informed by the fact that it is a legal instrument with no specific regulation in Portugal since it is not legally possible to incorporate a Portuguese Trust besides the special case of Madeira in which the corresponding foreign regulating law will be chosen by the settlor (with the possibility of amending such choice at any time). These Madeira Trusts are also designed to interfere as little as possible with the Portuguese domestic legislative system, which is not designed to entail such a legal concept. However, the Portuguese domestic tax legislation is fully equipped to tax the income potentially derived from foreign Trusts, with some anti-abuse rules and aggravated tax rates potentially applicable when the Trust is domiciled at a blacklisted jurisdiction for Portuguese purposes. We will be discussing the tax treatment in Portugal of the potential income streams derived from a foreign Trust by a private individual, and at the end of the article, we include some explanatory notes on the case of Madeira’s Hybrid Trusts.
Published Version
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