• All Portuguese employment income, considered as qualified within the scheme is taxed at a flat rate of 20%;
• Almost all foreignly sourced income is tax exempt;
• Inheritance or gift tax are tax exempt on possessions outside of Portugal, given that these are transferred to spouse, descendants or ascendants. If transferred to other individuals these are taxed at a flat rate of 10%;
• Exemption from wealth tax, in Portugal or abroad as well as any tax on funds settlement;
• Dependant on the Double Taxation Treaties signed between Portugal and the respective country, owning a Portuguese company means the possibility to take advantage of EU rules and directives on mergers, dividends, interest and royalties;
• If an individual is interested in foreign investment, when owning a Portuguese company these can benefit from the participation exemption regime on dividend or capital gains obtained.

If an individual has not been a resident in Portugal in the previous 5 consecutive years, all nationalities (including non-EU/EEA citizens), can apply for the NHR scheme. For eligibility an individual must meet the Portuguese Residency rules, alongside spending 182 days a year or having a main home in Portugal.

Portugal’s Non-Habitual Residence scheme was specifically introduced to encourage wealthy foreigners to relocate to the country. More specifically, it targets two groups:

• Retirees. 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.