THE PORTUGUESE NON HABITUAL RESIDENT PROGRAMME GOLDEN VISA

A beautiful Mediterranean climate, healthy economy and excellent quality of living make Portugal an attractive destination for families, businessmen, professionals and retired ex-pats looking for a better quality of life.

However, any international move brings financial implications, not least understanding the tax regime of a foreign country. Therefore, it is essential to know how the tax systems work and optimally structure your assets to remain tax-efficient.

In this context, Portugal’s Non-Habitual Resident (NHR) program is a hidden gem that could add more glitter to your migration plan. This regime offers attractive tax incentives for foreigners moving to Portugal for the first time or who haven’t been resident in the last five years.

NHR incentives include:

• Tax exemptions on foreign income
• Decrease in tax liabilities for ten years,
• Exemption from higher rate tax activities like employment

Although the NHR scheme is highly attractive and provides significant tax benefits, there are rules to be aware of.

What is the NHR Regime?

The National Tax Resource (NHR) is a tax regime designed to improve Portugal’s competitiveness. The government has targeted non-citizens who may have established permanent or temporary residence in Portugal.

What are the benefits of the NHR Regime?

• The advantages of the NHR Program in Portugal include:
• Income tax: Special individual tax treatment on incomes for 10 years
• Tax Exemption on almost all foreign sources of income (Income earned from outside Portugal like Dividends, Rent etc.)
• Compared to other Portuguese income tax rates up to 48%, this program offers a 20% flat rate on certain Portuguese-source incomes (from eligible professions and self-employment)
• Opportunity to have tax residency within the EU in a white-listed country
• Exemption of tax on gifts or inheritance to family members
• No wealth tax
• Free cash remittance to Portugal

How to get NHR status?

• You must be a resident in Portugal (the best way for an Indian’s is through Portugal Golden Visa)
• You should not have been a Portuguese tax resident in the preceding five years
• You must have a Residential Property in Portugal

As can be seen, there are many benefits available under the NHR regime, which makes Portuguese residency highly attractive for foreigners, especially those with passive income.

Note: The above should not be construed as tax advice. For specific advice pertaining to your case, kindly contact your tax consultant.

Acquest Advisors is an Investment Immigration Advisory specialising in Citizenship and Permanent Residency through Investment Immigration programs run by governments esp. America, Canada & Europe.