Portugal's Non-Habitual Resident (NHR) regime is closed to new applicants: it was replaced by IFICI (Incentivo Fiscal à Investigação Científica e Inovação), a narrower regime aimed at qualified professions, research and innovation. If you are moving to Portugal now, IFICI is the regime to look at. The NHR benefits described below apply only to people already registered under it.
What Was NHR?
NHR was a special tax status for people who became Portuguese tax residents without having been resident in the previous 5 years. It lasts 10 consecutive years and cannot be renewed. It closed to new applicants at the end of 2023, with a transitional window for some cases; those already registered keep their status until their 10-year period ends.
NHR Benefits (Existing Registrations Only)
- Foreign-sourced income (pensions, dividends, rental income, interest) may be exempt from Portuguese tax or taxed at a flat 10% rate, depending on source country and tax treaty
- Portuguese-sourced income from qualifying high-value professions is taxed at a flat rate of 20%
- No wealth tax on assets held abroad
- Potential exemption from inheritance tax on foreign assets
IFICI: The Regime for New Residents
Since 2024, new residents apply for IFICI instead. It is more targeted, mainly benefiting professionals in scientific research, innovation and technology, as well as qualifying startups and highly qualified roles. For 10 years, eligible Portuguese-source work income is taxed at a flat 20%, and most foreign-source income (excluding pensions) is exempt. Eligibility depends on your profession and employer, so confirm it with a tax advisor before you move.
Should This Influence Your Property Decision?
For retirees, digital nomads, and high-income professionals, tax residency strategy and property purchase often go hand-in-hand. Understanding your tax position before buying can significantly affect how you structure the purchase and how you finance it.
We always recommend consulting a qualified Portuguese tax advisor alongside your mortgage broker to ensure your financial strategy is fully optimised from day one.