Living in Portugal
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Tax regime for non-habitual residents

Competitive advantages:
  • Taxation, over a period of 10 years, at a fixed rate IRS of 20% , in certain circumstances, on labour income earned in Portugal;
  • No double taxation for pension incomes or for employment and self-employment income obtained abroad
How can you acquire Non-Habitual Resident Status?
  1. Having not been a resident in Portugal for the last 5 years;

  2. Register at the local tax office as a tax resident in Portugal (to do so you must have remained in Portugal for more than 183 consecutive or non-consecutive days, or having remained for less time, having, at 31st December of that year, a home in such conditions that would lead to the assumption that it is intended to be kept and occupied as your habitual residence);

  3. The request for enrolment as a non-habitual resident must be made, electronically, on the Treasury Portal, after registering as a resident in Portuguese territory and until the 31st of March of the year following the year you became a resident in this territory.  
Once Non-Habitual Resident Status has been obtained, what is the taxation rate and incidence applicable to domestic source income?

In the case of employed or self-employed work, the applicable tax rate is 20% in the case of income from activities with high added value, namely as university professors; doctors; management positions; information technology technicians, etc.

Registration as a Non-Habitual Resident gives you the right to be taxed as such for a period of 10 years from the year of your registration as a tax resident in Portuguese territory.

Having obtained the Non-Habitual Resident Status, what are the fees or exemptions applicable to income earned abroad?

  • Pensions (net income) obtained from foreign sources are taxed at the rate of 10%;
  • Income from employed work on a foreign source will be exempt when:

1. Are taxed in the other contracting State, in accordance with an agreement to eliminate double taxation convention celebrated by Portugal with that State; or

2. Are taxed in the other country, territory or region, in cases where there is no agreement to eliminate double taxation celebrated by Portugal, provided that the income, according to the criteria provided for in paragraph 1 of article 18 º of the IRS Code, does not to be considered obtained in Portuguese territory.

  • Income, from a foreign source, resulting from self-employment work (from services with high added value) from capital income or from property income is exempt from taxation in Portugal when:

1. May be taxed in the other contracting State, in accordance with an agreement to eliminate double taxation celebrated by Portugal with that State; or

2. May be taxed in another country, territory or region, in accordance with the OCDE model of tax convention on income and assets, interpreted in accordance with the observations and reservations made by Portugal, in cases where there is no convention to eliminate the double taxation celebrated by Portugal, provided that they are not included in a list approved by order of the Government member responsible for the area of finance, regarding privileged taxation regimes, clearly more favourable and, as well, provided that the income, according to the criteria provided for in Article 18.º of the aforementioned code, are not to be considered obtained in territory.


THIS INFORMATION IS NOT INTENDED TO BE A SUBSTITUTE FOR CONSULTING THE APPLICABLE LEGISLATION
Governo de Portugal