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Thinking of going to Portugal for vacation but would like to spend more time there than our typical vacation. Do I have to pay taxes for the work performed there for US-based clients and company? It will be short term less than a month. I am having a hard time finding info on this situation.

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    You will run into the issue of being allowed to work at all long before having to pay taxes. It doesn't really solve the question but one month isn't necessarily longer than many people's summer vacation in Europe and won't raise any eyebrow. – Relaxed Feb 10 at 22:02
  • And you still have to pay taxes in the US for your income even for the time where you're physically in Portugal, at least with the timeframes you mentioned. – dunni Feb 10 at 22:37
  • If you're specifically interested in tax, you might be better asking in money.stackexchange.com which includes personal tax issues in its remit. Also if you're employed by a company (your question doesn't make it clear) you should consult with them if they know any issues. – Stuart F Feb 11 at 15:58
  • I think this is off-topic here or close to it, but anyway in most places this is in a legal gray area but most places don't care much if you do some work while you are on vacation provided you are 100% paid from outside their country. Portugal seems to be a bit ahead of the curve (as they are in some other areas) and are apparently officially working to deliberately attract "digital nomads" with suitable visas and so on. – Spehro Pefhany Feb 13 at 3:15
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In most countries, the tax code hasn't caught up yet with digital nomads and remote work, so it's a grey area.

A few things typically apply:

  1. If you are a US citizen, you MUST file a US tax return no matter where you live and what you do. All other countries base taxation on residency, but the US (and Eritrea) base it on citizenship.
  2. If you are on business travel, you are allowed to do work for your employer in some other countries without permit or local taxation unless you hit the residency threshold which is typically 180+ days per year.
  3. What you are describing is a legal grey area that's not well defined.

That being said: for a month long trip, you should be fine, especially if you are reasonably discreet about it.

Good reads: https://jeangalea.com/digital-nomad-taxes/

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  • I'm really not convinced about point #2. In most countries, on a visit visa, you are not allowed to work, only "do business", which usually means meeting customers, suppliers, etc, but not doing actual work. The exact limit between the two is indeed a gray area in most places, though, and of course for a short trip doing remote work for the usual employer abroad the chances of anybody finding out are close to 0. – jcaron Feb 13 at 13:21
  • What would be the difference of "doing business" and :doing "actual work"? For many people visiting suppliers is there actual job. In one of my companies we had people that spend so much time in China that we had to carefully manage the 180 days/year threshold. Otherwise they would have had to file a Chinese tax return. – Hilmar Feb 13 at 18:43
  • Many countries detail what they consider doing business as opposed to work, sometimes with lots of examples in either category, though there are nearly always still activities which remain in a gray area, which may be a lot larger in some countries. Note that spending over half of the year in a country usually makes you fiscally resident in that country, but you can be taxable on any work performed in a country even if you stay only a few days. That’s were double imposition treaties (or the lack thereof) come into play, as both countries usually want their share of the cake. – jcaron Feb 13 at 23:10

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