If you've ever dreamed of enjoying the beauty of Portugal while benefiting from a reduced tax burden, now is the time to take action. The Non-Habitual Resident (NHR) Program, which has been a beacon of tax relief for expatriates, is coming to a close at the end of 2023. But there's still a window of opportunity, and you won't want to miss it!
What is NHR?
The NHR program is a unique scheme in Portugal that offers a significant reduction in Personal Income Tax (IRS) over a 10-year period. It's essential to note that this tax regime doesn't cover all types of income; it primarily applies to income earned abroad, not within Portugal. The key advantage lies in the application of an IRS tax rate of just 20% on income from employment and self-employment related to high-value-added activities, as defined by the regulations. Moreover, pensions received from abroad and registered under the NHR tax regime since April 1, 2020, are subject to a mere 10% IRS tax rate.
The Countdown Begins
The clock is ticking on the NHR program, but there's a silver lining for those who are already benefiting from it. Prime Minister António Costa has assured that current beneficiaries and enrollees will continue to enjoy the program's benefits for the specified duration. This means that if you're already part of the NHR regime, you'll keep your favorable tax conditions even after the program ends.
The NHR tax regime has been nothing short of a success story. Last year, it saw a substantial increase in registrations, with 57,887 individuals joining in 2021. By 2022, the number had risen to an impressive 74,258. While we don't have the official numbers for 2023 yet, it's expected that with the recent announcement regarding the program's closure, even more individuals will take advantage of the NHR regime.
Why Portugal?
Portugal is not just a tax haven; it's a country that offers so much more. With a stable political and social environment, Portugal ranks 7th globally in the Global Peace Index, providing a strong sense of security for residents. Families are drawn to the country for its high quality of life, highly skilled workforce, and ease of communication in languages such as English.
For entrepreneurs, highly skilled professionals, and high-net-worth individuals, Portugal's appeal as a gateway to the European Union is undeniable. The country's stunning landscapes, rich history, and vibrant culture only add to the allure of making Portugal your new home.
The NHR program has been a fantastic opportunity for many, and as it draws to a close, there's no better time than now to explore your options and make the most of this unique tax regime. Portugal beckons with open arms, and you have until the end of 2023 to make your move and secure your place in this stunning country. 🌞🇵🇹💼
