Filing in both US and Portugal — what do I file?

If you are resident there, a Portuguese return, prepared on the terms of whatever status you registered under. Alongside it the return in the other country continues, because that obligation carries on regardless of the Portuguese treatment of the same income. A special status changes how income is treated inside the Portuguese return; it does not remove the return, and it does not remove the other one. The first piece of work on this corridor is therefore the registration record, because it determines how one of the two returns has to be prepared.

Yes. An exemption on one side says nothing about the filing obligation on the other, and on this corridor the US obligation continues regardless of what Portugal does with the income. An exemption usually makes the other return matter more, because relief there is given for tax actually paid and there is now none to claim. So the return is filed, the income is reported, and the charge is whatever the residual rules produce. Treating a Portuguese exemption as the end of the matter is the most common error here.

It changes what goes into the return and how items are treated, not whether one is due. Which version of the terms applies to you depends on your own registration rather than on the regime as currently described, so the same income can be entered differently by two people filing in the same year. That is why the registration is read before the return is drafted. Keep the record with the tax papers, because the same question arises every year and the answer is fixed by the terms you entered under.

Alongside the return there is separate reporting about accounts and assets held outside the country, triggered by holding them rather than by income arising on them. Moving to Portugal typically creates several at once, such as a local bank account and perhaps a local plan or property, so the year of the move is when the reporting inventory grows. Build the list from everything you can sign on rather than from whatever produced income, and revisit it each year. This is the part clients most often have to bring up to date afterwards.

Yes. Portugal assesses the part of the year its residence rules reach, so its return covers a period, while the other country return covers the whole of it. If you registered under a special status partway through, that adds a date of its own inside the same year. The filings are separate documents on separate timetables, and the items that straddle the move are allocated once and then reported the same way in both. Doing the allocation before either return is drafted saves preparing both of them twice.

The letting comes into your Portuguese return as a resident, and the country the property sits in has its own claim on it, so the same rent is reported twice on two measures of profit. Expenses, depreciation and the treatment of improvements do not match between the two systems, which means one set of records has to be recast rather than copied across. How your registered status treats foreign property income decides the Portuguese figure, so that is checked before the return is prepared.

Frequently yes, and the two filings do different jobs. The country where the income arises taxes it at source; the country where you are resident taxes your worldwide income and then gives credit for the tax already paid. Filing only one side is what leaves relief unclaimed — the credit has to be asked for on a return. We prepare both sides so the numbers agree. See dual filing.

Both countries have routes back, and using one before they contact you is what preserves the relief. On the US side there are procedures aimed at taxpayers whose failure was not wilful, including one designed for people living outside the country, and separate procedures for late account reports and information returns alone. Canada has its voluntary disclosures programme and taxpayer relief for penalties and interest. Filing quietly and hoping is the one approach with no protection attached to it. See catch-up filing.