The Comeback of Portugal's NHR Tax Scheme: What Expats Need to Know

The tax regime for non-habitual residents will be reinstated through a decree, bypassing the need for parliamentary approval, the Finance Minister announced.

The focus is on a new talent attraction scheme called IFICI+, which is one of the 60 measures unveiled by the Government today to boost the economy. This scheme is based on the former regime for non-habitual residents, aiming to position Portugal as a prime destination for global talent and investment.

"The previous Government, in the State Budget for 2024, created a provision in the tax benefits statute," Joaquim Miranda sacramento recalled during the press conference following the Council of Ministers meeting. The current administration will now regulate this measure through a decree, ensuring swift implementation without the delays associated with parliamentary processes.

"We will regulate this provision through a decree, exclusively covering income from categories A and B, which will be subject to a 20% tax rate for non-residents who move to Portugal and have not resided here in the last five years, nor are currently benefiting from the previous regime established in 2009," stated the Finance Minister. This initiative reflects Portugal's commitment to creating a favorable environment for expatriates and foreign investors, promoting economic growth and innovation.

In an interview with the Financial Times, published today, the Finance Minister highlighted that "it will exclude dividends, capital gains, and pensions, which were problematic between Portugal and countries like Finland or Sweden." This targeted approach ensures the new regime is both attractive and sustainable, avoiding previous pitfalls and fostering strong international relations.

Overview of the Reinstated Tax Regime for Non-Habitual Residents in Portugal

Reintroduction Through Decree:

- The tax regime for non-habitual residents will be reinstated via a decree.

- This approach bypasses the need for parliamentary approval.

New Talent Attraction Scheme: IFICI+:

- Part of a broader package of 60 measures to stimulate the economy.

- Based on the former regime for non-habitual residents.

Taxation Details:

- Exclusively covers income from categories A (employment) and B (self-employment/business).

- Subject to a 20% tax rate for qualifying non-residents.

Eligibility Criteria:

- Non-residents who relocate to Portugal.

- Must not have resided in Portugal for the last five years.

- Must not currently benefit from the previous regime established in 2009.

Exclusions:

- The new regime will exclude dividends, capital gains, and pensions.

We invite talented professionals and investors from around the world to explore the opportunities that Portugal offers. By choosing Portugal as your new home, you can benefit from a competitive tax rate, a high quality of life, and a vibrant, dynamic economy. Join us in driving forward innovation and growth, and be part of Portugal's exciting future.

Embrace this chance to thrive in one of Europe's most welcoming and promising countries. Portugal is ready to welcome you with open arms and a wealth of opportunities.