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CategoriesInvestment Property

NHR Framework 2024

By nvjeronimo,

For those who arrive in Portugal in 2024 without any previous connection with the Portuguese territory, the previously existent NHR program is no longer available.
The known NHR is still applicable for those individuals that:

  1. On December 31st, 2023, meet the conditions to qualify as residents for tax purposes in Portuguese territory;
  2. Become residents for tax purposes until the end of 2024, and who prove, for the purposes of their registration as a non-habitual resident, that one of the following eligible tests is met:
    1. Promise or work contract, promise or agreement of secondment concluded until December 31st, 2023, the performance of whose duties is to take place in national territory;
    2. Lease agreement or other agreement granting the use or possession of real estate in Portuguese territory signed until October 10th, 2023; or
    3. Reservation contract or promissory contract for the acquisition of a right in rem over real estate in Portuguese territory signed until October 10th, 2023;
    4. Enrolment or registration for dependents in an educational establishment in Portuguese territory, completed by October 10th, 2023;
    5. Residence visa or residence permit valid until December 31st, 2023;
    6. Procedure, initiated until December 31st, 2023, for granting a residence visa or residence permit, before the competent authorities, in accordance with the legislation in force applicable to immigration, namely through the request for an appointment or actual appointment for submission of the application for a residence visa or residence permit, or by submitting the application for the granting of residence visa or residence permit.
    7. Being a family member of the applicants in any of the situations mentioned above referred
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CategoriesInvestment Property Tax Regime

The Non Habitual Tax Regime (NHR)

By nvjeronimo,

The non-habitual resident (NHR) regime is open to anyone who has the right to reside in Portugal (an EU/EEA/Swiss citizen or a holder of a residents permit who has not been a tax resident of the country during the previous 5 years. 

Under this regime, the following taxation rules apply:
    • Foreign-source self-employment or sole trader income derived from an eligible occupation (see below), royalties, capital gains and investment or rental income will be exempt from Portuguese tax as long as they may be taxed in the source country either under a double taxation agreement or under the OECD model tax convention. In addition, such income must not be deemed Portugal-sourced under applicable Portuguese law, and must not be sourced from a blacklisted tax haven.
    • Foreign-source employment income will be exempt from Portuguese tax as long asit is liable to tax (at whatever rate) in the source country either under a double taxation treaty or under the OECD model tax convention, and is not deemed Portugal-sourced under applicable Portuguese law.
    • Occupational pension income will be exempt from Portuguese tax as long as it is liable to tax in the source country under a double taxation treaty or it is deemed as not being Portuguese-source income under applicable Portugueselaw.
    • If your occupation is eligible (see below), Portugal-source employment or self-employment / sole trader income will be taxed at a flat rate of 20%, while other Portugal-sourced types of income will be taxed at the normal rates applicable to resident taxpayers, the calculation of the applicable marginal tax rate taking into account all income, including exempt income.
    • In Portugal there is no wealth tax or capital duty, and an inheritance or a gift received by a spouse, descendant or ascendant is tax exempt. Inheritance or gifts received by other individuals will be either not taxable under territoriality rules, or else may be subject to a flat 10% stamp duty.
If you are interested in learning more about the NHR and purchasing a property in the Algarve do not hesitate to get in touch.
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