It is common to use a company to own premium property in Portugal and choosing the right company manager is vital. It is somewhat like deciding which insurer to use: you only realise the value of your choice when you really need it.
What do we, as company managers, actually do?
We maintain the records of the company which includes the register of directors, register of shareholders and register of secretaries. We draft board and shareholder resolutions prepare powers of attorney as required, open bank accounts if needed and ensure the company is kept in good standing. Where necessary, we also prepare financial statements to ensure that your investment is properly accounted for, in addition to holding all other essential company documents, such as deeds of title and certificates in safe custody. Upon request (usually prior to sale) we prepare a status report detailing the full company history.
We provide Directors and Secretarial services to the companies we manage and can also hold shares on your behalf under a nominee agreement.
Most importantly, however, we are a key component in the process of sale and purchase because your conveyancing solicitor needs to have the confidence that the company manager he or she is dealing with can be trusted to have completed all requirements and that the manager’s word is its bond. In the sale and purchase process it is the company manager who affirms and certifies the status and standing of the company so that the transaction can proceed.
Why use a company to hold Property?
There are a number of reasons for this:
- Ease of sale/purchase;
- Inheritance purposes/succession planning;
- Shares can be held in trust; and the
- Saving on transfer tax (6%)
- Purchasing a property jointly with friends/family
Recurring annual fees will be payable to the company manager which normally only makes it desirable for high value Portuguese properties over 600.000€ to be purchased under a company structure. Properties below this value may still be held via a company structure for any of the reasons above.
Why use Abacus?
Abacus is licensed and regulated by the Gibraltar Financial Services Commission (“GFSC”) to provide a full range of company administration services including the provision of directors, secretary, nominees and trustees.
We currently use Delaware and Malta companies to hold high value Portuguese properties.
We have an office in Almancil managed by Anne Darlington, who is fluent in Portuguese and English and can assist with any local requirements you may have.
Protection is key: you get what you pay for.
Abacus has to pay substantial licence fees each year for obtaining the benefit to clients of this independent prudent oversight and under these licences we have stringent reporting requirements in line with regulatory requirements. The main benefit to clients is the protection this provides. In the event of a problem of any kind, clients are able to call directly on the GFSC as a supervisor to take appropriate action against the licensee. In addition to this Abacus has professional indemnity insurance and Director and Officer insurance which provides more reassurance to the client.
The nature of these potential problems should not be lightly dismissed. There may be a defect in title. There could be real material problems with the property itself. In the process of a purchase, it is essential to ensure that money being transferred between the parties only does so when all the correct documents are in place – not all company managers are able to certify to the same extent.
Abacus has over 50 staff, of which 10 are dedicated to servicing our clients in Portugal. Our long-standing ability to turn documents around efficiently and our availability to clients on a daily basis are our key strengths.
Questions to ask yourself when appointing a Company Manager?
Where is the company manager registered and physically located as a business?
How long has the company manager been providing the services that they advertise?
Is the company management firm regulated under an appropriate company management licence?
Is the firm regulated/supervised anywhere in the EU or the USA by a statutory regulatory body?
Who are the firm’s auditors?
Where does the firm pay its taxes?
Do they have Professional Indemnity Insurance or any other compensation arrangement in place in the event of a claim against their services?
How many full time staff does the company manager have dealing with the administration of companies? Is there sufficient cover for absenteeism, sickness or other unavailability?
Do they have an office in the Algarve fully staffed and open five days a week?
Have you obtained written recommendation for the firm from two established Algarve law firms?
How professional is their website?
What is the cost of transferring your company to a new company manager?
Who will act as Directors of the company if you move?
Please contact us should you have any queries: