PORTUGAL NON-HABITUAL RESIDENTS” (NHR) TAX REGIME
Who can apply: NHR are individuals who became resident in Portugal, and five years prior they were not domiciled, for tax purposes, in Portugal and exercise one of the following professions:.
- Company’s General Manager and Executive Manager
- Administrative and Comercial Services Directors;
- Specialized Products and Services Directors Diretores de produção e de serviços especializados
- Hospitality, Catering Commerce and other Services Directors;
- Specialists in Physical, Mathematical, Engineering Sciences and related technics;
- Dentists and Stomatologists Physicians
- University and Higher Education Teacher
- Information and Communication Technologies
- Authors, Journalists and linguists
- Creative Artists
- Technicians and professions of science and engineering,
- Information and Communication Technologies Technicians
- Farmers and Qualified Farm workers and animal production, market orientated;
- Forest, fishing and hunting qualified workers, market orientated
- Artisans and Industrial and Construction qualified
- Instalation and Machinery operators and assembly workers.
- Directors and managers of companies that promote productive investment working for specific projects and with tax incentive contracts signed.
- The NHR tax regime is applicable for ten consecutive years from the year of NHR Registration (included);
- The NHR Portuguese-sourced employment income (category A) and/or self-employment income (category B) obtained from high added value activities (scientific, artistic or of technical naturee ) are subject to a flat 20% IRS tax rate (the current maximum standard tax rate for a non-NHR is 53%);
- Pension income obtained abroad by the NHR is tax exempt, provided that one of the following conditions met:
- that income was taxed in a Country with whom Portugal has entered the Double Taxation Avoidance Agreement; or,
- that income cannot be considered as obtained in the Portuguese territory, according to the Portuguese Tax Income criteria.
- Further exemptions may be obtained if
- that income was taxed in a Country with whom Portugal
- has entered the Double Taxation Avoidance Agreement; or,
- Has not entered the Double Taxation Avoidance Agreement and that income cannot be considered as obtained in the Portuguese territory.
That income derived from
- high added value services activities (that are of scientific, artistic or technical nature );
- intellectual or industrial property area (i.e. royalties); or
- the provision of information services in the industrial, commercial or scientific sector
- investment income, rental income and capital gains that also benefited from an exemption provided that such income may be taxed in a Country with whom Portugal
- has entered the Double Taxation Avoidance Convention; or,
- has not entered Double Taxation Avoidance Convention and that income cannot be considered as obtained in the Portuguese territory, except for blacklisted jurisdictions (“tax havens”).
- Portugal does not tax any taxation on donations and inheritances to spouses and direct descendants and direct relatives in the ascending line.