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Trusts, as they are commonly known in some legal systems, have a unique standing in Portugal, including Vila Nova de Gaia. Unlike countries such as the United Kingdom and the United States, Portugal operates under a civil law system, which traditionally does not recognize the concept of the trust as a separate legal entity. Instead, similar objectives, such as asset management, inheritance planning, and protection of beneficiaries, are achieved through different legal structures like foundations and certain contractual arrangements. For residents or property owners in Vila Nova de Gaia, understanding these distinctions is crucial before seeking to create or manage a "trust"-like arrangement.
Engaging a lawyer when considering trusts-related matters in Vila Nova de Gaia is essential due to the complexity and specificity of Portuguese law. Some common situations where legal advice is invaluable include:
Portuguese law, particularly in Vila Nova de Gaia, does not formally recognize the Anglo-Saxon institution of trusts. Instead, similar outcomes are achieved through mechanisms such as:
Portugal has ratified the Hague Convention on the Law Applicable to Trusts and on their Recognition, but only in a way that affects conflicts of law situations, not substantive law. Thus, trusts governed by foreign law may sometimes be recognized for certain purposes, such as taxation or international succession.
Trusts, as established in common law countries, are not part of the Portuguese legal system. However, similar goals can be met through other legal vehicles like foundations or through contracts.
You cannot establish a trust under Portuguese law, but you may be able to use a foreign trust for certain cross-border situations. Alternatively, you can achieve related objectives through local solutions, such as foundations.
Portuguese inheritance law is governed by forced heirship rules, which dictate that a certain percentage of your estate must pass to your spouse, children, or other close relatives.
Foreign trusts may be recognized for purposes such as taxation or for settling the estates of individuals who have ties to other countries, but their legal effect is limited compared to common law countries.
A foundation is a legal entity set up to carry out a specific purpose, often philanthropic or family-oriented. It must comply with stringent Portuguese legal requirements and governance structures.
No. Even if a foreign trust is involved, Portuguese courts may apply forced heirship rules to assets located in Portugal or to residents of Portugal.
Trusts themselves are not recognized as legal entities for tax purposes in Portugal, but income or gains distributed to Portuguese tax residents from a trust may be taxable.
You may need to establish a guardianship or a similar legal arrangement. Sometimes, creating a foundation or putting assets under management contracts can also help protect vulnerable individuals.
Seek legal advice to understand your rights and taxation obligations in Portugal. Local succession law and tax law may affect your position.
Consult a Portuguese lawyer specializing in succession and asset protection. They will guide you on local laws, international issues, and the best structure to achieve your objectives.
For more information or to address specific queries regarding trusts and similar arrangements in Vila Nova de Gaia, consider the following resources and organizations:
If you need legal assistance regarding trusts or similar arrangements in Vila Nova de Gaia, follow these steps:
Taking early and informed legal advice is the best way to achieve your estate planning or asset management goals in Vila Nova de Gaia, Portugal.
