Non-Habitual Resident Status in Portugal: what has changed and what you can do to apply for the New Tax Benefits?
The Non-Habitual Resident (NHR) status in Portugal, a special tax regime that could be granted to anyone who had not been a tax resident in Portugal in the previous 5 years, came to an end with the arrival of 2024. However, not everything is bad news for those looking to live or invest in Portugal…
Granted for a period of 10 years, ensuring, for example, that foreign pensions would be subject to a fixed rate of 10%, it is now known that this regime will continue to apply until the end of the 10 consecutive years.
It will not, however, be available for new applications. Nevertheless, after much discussion, a new regime was approved in the Portuguese Parliament to replace this status, aiming to be a tax incentive for scientific research and innovation. This benefit will also be applicable for 10 years with an IRS rate of 20%.
Similar to the previous regime, it is accessible to individuals who have not been residents in Portugal in the five previous years. If this applies to you, note that to apply, you will need to become tax resident and occupy a position in entities certified as "startups."
According to the law, these companies must have fewer than 250 employees, an annual turnover not exceeding 50 million euros, be in operation for less than 10 years, have headquarters or representation in Portugal, or at least 25 employees in the country. Additionally, among other requirements, they should not result from the spin-off of a large company.
This new tax regime will also cover "qualified positions recognized by the Agency for Investment and Foreign Trade of Portugal, E. P. E., or by IAPMEI - Agency for Competitiveness and Innovation, I.P., as relevant to the national economy, particularly in the context of attracting productive investment."
The 20% rate applies to income from categories A (dependent work) and B (business and professional income) earned in Portugal and resulting from high value-added activities with a scientific, artistic, or technical character, with no maximum income limit.
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Sources:
https://www.idealista.pt/news/imobiliario/habitacao/2023/12/13/60636-fim-do-rnh-suavizado-em-2024-quem-vai-poder-beneficiar-do-regime
https://imojuris.vidaimobiliaria.com/actualidade/noticias/oe-2024-regime-fiscal-transitorio-para-os-rnh/