What is NHR 2.0?
NHR 2.0 aims to attract international talent and high-net-worth individuals while encouraging companies to invest in high-value sectors.
The regime offers a competitive 20% flat tax rate on eligible Portuguese-sourced employment and self-employment income included within the regime’s activities, as well as tax exemptions on most foreign income, with the exception of foreign pension income.
The new focus is primarily on stimulating research, innovation and economic development in sectors considered vital to the country’s future.
How to qualify for the NHR 2.0 programme
To qualify for NHR status, you must have the right to live in Portugal and you need to be a new Portuguese tax resident (you cannot have been a Portuguese tax resident in the five years preceding your application).
To be considered tax resident in Portugal, you generally must either have lived in Portugal for more than 183 days in the past 12 months or have a home in Portugal on 31 December of the year in question. You do not have to own this property and may show a 12-month lease as proof of residence.
You must work in or be planning to work in a qualifying high-value-added activity and meet the specific requirements set out by the regulators.
Qualifying high-value-added jobs list
- 112: Directors-general and executive managers of companies
- 12: Directors of administrative and commercial services
- 13: Production and specialised services managers (except 1349)
- 21: Specialists in physical sciences, mathematics, engineering and related techniques (except 216)
- 2163.1: Industrial or equipment product designers
- 221: Physicians
- 231: University and higher education professors
- 25: ICT (Information and Communication Technology) specialists
- 14: Administrators, managers and general managers
These roles must generally be supported by a doctorate degree or a bachelor’s degree with three years of professional experience.
Qualifying start-ups
- Companies must generate at least 50% of their turnover from exports OR operate in key sectors such as manufacturing, information technology and research and development (R&D).
- Certified start-ups must:
- Operate for less than 10 years
- Employ fewer than 250 workers
- Generate an annual turnover of less than €50 million.
- Start-ups must also demonstrate innovation or secure external investments, such as venture capital or funding from the Portuguese Development Bank.
Benefits for skilled professionals in Portugal’s IFICI regime
Non-Portuguese income, excluding pensions, is tax-exempt. This includes dividends, interest, rental income, capital gains from real estate/securities, and crypto-related income provided it is from a country with a DTA or a non-blacklisted jurisdiction
20% income tax rate on employment and self-employment income for specific Portuguese-source income from qualifying professions for up to 10 years*
No requirement to own property – renting is sufficient
Be part of a white-listed tax environment within the EU
Notes for retirees
Unlike the previous NHR regime, the IFICI no longer offers preferential tax rates on foreign pension income. These are now taxed under Portugal’s normal progressive tax rates of 14.5% to 53%.
The definition of “retired” remains flexible, allowing individuals to continue managing business interests abroad while maintaining residency in Portugal.
Contact a wealth adviserFactors to consider about the NHR 2.0 programme
Early cross-border financial planning is crucial and will help you avoid costly mistakes later.
Some things to consider before you make the move:
- You cannot register for the NHR 2.0 regime if you are already a tax resident in Portugal or if you were a Portuguese tax resident in the previous five years.
- To benefit from the regime, you must apply before submitting your first tax return as a Portuguese tax resident. For individuals who became tax resident in 2024, the deadline to apply was extended to 15 March 2025.
- Once you are considered tax resident in Portugal, you will be required to pay tax in Portugal. How much you pay will be subject to any double taxation agreements (DTAs) that exist between Portugal and any other country where you may have tax obligations.
- It may be tax-efficient to inform the tax authorities in your previous country of residence that you have moved to Portugal, so that you are only taxed in one jurisdiction and avoid potential double taxation.
- The special tax rates and exemptions under the NHR 2.0 regime apply for 10 years. After this period, your income will be subject to Portugal’s general income tax rates. However, with early and careful planning, it is possible to structure your affairs to reduce your tax burden beyond the 10 years.
Early cross-border financial planning is crucial and will help you avoid costly mistakes later.
Frequently asked questions about the NHR 2.0 programme
Who can apply for NHR 2.0 status?
To be eligible, an applicant must be a Portuguese tax resident and must not have been a Portuguese tax resident in the five years preceding their application. They must also work in a qualifying profession or sector supported by a doctorate degree or a bachelor’s degree with three years of professional experience.
Does the term “non-habitual” mean I must live outside Portugal?
No. Despite the name, you must be a Portuguese tax resident to benefit from the regime and spend more than 183 days per year in Portugal (or meet other residency criteria).
Do I need to buy property in Portugal?
No. Renting a property with a minimum 12-month lease is acceptable for residency purposes.
How long does the application process take?
The application is done online and takes some months to be processed by the relevant authority (e.g., Tax Authorities, AICEP or IAPMEI), so careful planning is required. It can be made only once you have changed your tax residency to Portugal. If you have a value-added activity, you should have evidence available if this is ever required.
How to apply for Portugal’s IFICI Tax Incentive in 2025?
- Determine the relevant authority
Identify the appropriate authority based on your activity (e.g., Tax Authorities, AICEP or IAPMEI) to submit the enrolment request - Complete initial registration
Register with the relevant authority to indicate your intention to apply for the IFICI tax incentive. - Submit your application
Ensure your application for the IFICI regime is submitted by 15 January of the year following your residency. For instance, if you obtain residency in 2025, the deadline will be 15 January 2026 - Employer verification
Employers must confirm that your role meets the eligibility criteria for highly qualified positions via the Tax Authorities’ portal. - Verify compliance
Depending on the relevant activity, check the corresponding compliance conditions (excluding export turnover thresholds and ensure your activity aligns with the regime’s requirements for industrial or service companies)
How long does the tax status last?
The IFICI/NHR 2.0 benefits last for 10 consecutive, non-renewable years.
When is Portugal’s tax year?
The Portuguese tax year runs from 1 January to 31 December.
Do I need to apply for Portuguese residency?
Yes
- EU/EEA/Swiss nationals: Obtain a residence certificate from the local municipality.
- Non-EU/EEA/Swiss national: Apply for a residence permit through Portugal’s immigration services (SEF or AIMA)
Speak to a cross-border wealth adviser today
Don’t hesitate to get in touch if you have any questions or would like to discuss cross-border wealth planning solutions.
Disclaimer: Please do not act in reliance on information published or advised without consulting a suitably qualified independent legal or other professional advisor of your own choosing. Sable International will not be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of their use or reliance on any of the advice provided by any one or all of the professional advisors identified by Sable International; loss or damage suffered by any person as a result of changing government legislation; and/or changing rules around immigration and nationality. Obtaining residency and citizenship is at the sole discretion of the government in question and cannot be guaranteed by Sable International.