TAX REGIME FOR EXPATRIATES IN PORTUGAL
The Portugal acknowledged the non-habitual resident tax status which allows you to take advantage of a special tax rate for certain income from Portuguese sources and also to benefit from exemptions on income from foreign sources.
In order to be able to qualify for non-habitual resident status. You must not have resided in Portugal during the 5 years prior to applying for the program. You must also stay in Portugal for more than 183 days per year and be covered by the private health insurance system.
Non-habitual resident status applies for a period of ten years.
Non-habitual resident status will have several consequences:
- Regarding income from Portuguese sources: the employment income derived from employment or self-employment, from a Portuguese source, and received by a non-habitual resident are taxed at the preferential rate of 20 % in Portugal, provided they relate to a high-value-added activity.
On Income from Foreign Sources
- Private retirement pensions from French sources received by a non-habitual resident will also not be taxable in France and will be exempt from tax in Portugal. They will therefore be exempt from all taxes for ten years.
- The salaries from’foreign-sourced high-value-added activities of a non-permanent resident are exempt income tax in Portugal, subject to certain conditions to be actually taxed in the source country. Otherwise, they will be taxed at a rate of 20%.
- The income from securities from foreign sources are also exempt from income tax in Portugal, provided that such income is subject to taxation in the source country. It is therefore not necessary for this income to be actually taxed abroad; it is sufficient that it be subject to taxation there.
IFI
L'ISI does not exist in Portugal, nor do the inheritance tax.
