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Non-Habitual Residence

TAX-FREE LIVING IN PORTUGAL
Portugal's Non-Habitual Residence (NHR) tax regime was introduced in 2009. Since its introduction, many people moving to Portugal from other countries have been able to enjoy a highly advantageous tax arrangement.

What are the benefits of NHR?
Non-Habitual Residence in Portugal enables individuals moving from abroad to receive a tax-free income for ten years from both Portugal and the country from which they have arrived.

This income includes salaries, pensions, rental earnings, capital gains on property, interest on savings, dividends and almost any other non-Portuguese income. Pension income is tax-free whether pensions are paid weekly or taken as a lump sum for ten years, after which it will be taxed at the normal rate.

Who is eligible for Portugal's NHR status?
Portugal’s Non-Habitual Residence scheme was specifically introduced to encourage wealthy foreigners to relocate to the country. More specifically, it targets two groups: 

  • Retired people. The Non-Habitual Residence scheme benefits those receiving a pension income from outside Portugal. A French State Pension, for example, is tax-free under the NHR system. So whatever way you access your pension, NHR allows you to do so without paying any tax on it for ten consecutive years. 
  • People with jobs of 'high added value'. Under the Non-Habitual Residence scheme, people with specific careers only pay a flat 20% tax rate on their earnings. Suitable professions are wide ranging, and include engineers, architects, doctors, artists, university teachers and business managers.


To benefit from the NHR scheme, you must be legally resident in Portugal. This means you must either:

  • Own your primary residence in Portugal 

or

  • Spend more than 183 days in Portugal each tax year, which runs from 1 January to 31 December

In addition, you must not have been taxed in Portugal, as a tax resident, in the previous five years.

How do I apply for NHR status?
If you are considering moving to Portugal, you should seek advice regarding the Non-Habitual Residence scheme from tax specialists who can provide you with complete and accurate information.

Along with the stunning climate and lifestyle southern Portugal offers, the NHR tax regime has made the Algarve an even more attractive location for retirees, knowledge workers and high net worth individuals.

One Select Properties helps you find your perfect Portuguese property. Explore the wide range of luxury homes we offer and you could soon be enjoying the Algarve sun, wonderful amenities and soaking up the unique ambience of southern Portugal. All with the additional disposable income resulting from your tax savings under the NHR regime.

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