Taxation

Non Habitual Residence Regime - NHR

The objective non-habitual tax resident (NHR) is to attract professional experts who wish to reside in Portugal, dedicated to activities of high added value or intellectual, industrial property or know-how activities; as well as pension beneficiaries received abroad. The objective non-habitual tax resident (NHR) is to attract professional experts who wish to reside in Portugal, dedicated to activities of high added value or intellectual, industrial property or know-how activities; as well as pension beneficiaries received abroad. NHR's main tax advantages:

• 20% tax rate fixed on high added value income from Portuguese sources. There is a list of eligible professions under NHR such as: directors and managers of companies with permanent establishments, engineers, IT professionals, doctors, dentists, actors, musicians, university professors.

• 10% tax rate fixed on foreign pension income.

• Tax-exempt on certain types of income from foreign sources in Portugal, also exemptions in the country of origin, as stipulated in the DTA between Portugal and the country issuing the income.

Conditions for obtaining the NHR regime:

• Not having resided in Portugal in the last 5 years.

• Register as a tax resident in Portugal in the local Finance Department.

Application for the assignment of NHR status at the time of registration as a tax resident in Portugal or until March 31st of next year after become Portugal resident.

Golden Visa – Residence Permit for Investors

The Golden Visa is a temporary residence permit, which may become permanent, that the Portuguese government issues to attract foreign investment to their country.

Individuals from any country outside the European Union, directly or through a company, who invest in any of the Portuguese Government-defined investments and keep this investment for at least five years, from the date they obtain the residence permit and the engagement declaration required by regulations.

Main investments available to apply for a golden visa:

• Acquisition of real estate property worth at least €500,000.

• Acquisition of real estate property worth at least €350,000 located in an urban rehabilitation area or construction completed at least 30 years old, with the execution of rehabilitation works.

• Capital transfer, including purchase stocks/shares in a Portuguese company, of at least €1 million.

• Capital transfer of at least €350,000, destined to acquire units in investment or venture capital funds. This investment must be at least 60% Portuguese registered business and the maturity of units is no less than 5 years old.

The Golden Visa enables investors and their family to live in Portugal and free movement within the Schengen zone, 26 European countries which have established passport and immigration controls within their common borders.

Permanent residency: holders of residence permit temporary valid for at least five years. Investors and their family members must comply with additional requisites for requesting a Portuguese permanent residence permit.

Portuguese citizenship: resident (temporary or permanent) in Portugal for at least five years.

Download the prerequisites to obtain the Portuguese Golden Visa

Real Estate Taxation

Buyers of real estate property in Portugal must pay the Transfers Municipal Tax (IMT for its Portuguese initials).

The basis for the IMT calculation is the real estate purchase price or its taxable value (whichever is higher) and varies depending on whether the property is the main residence or second home. The applicable IMT rates for each scenario are explained below:

• Acquisition of urban real estate or an autonomous fraction of urban property, exclusively for the owners’ permanent housing



Amount for applying IMT (en euros)	Tax rate
	Marginal	Average(*)
Up to 92.407 €	0%	0%
From 92.408 € to 126.403 €	2%	0,5379%
From 126.404 € to 172.348 €	5%	1,7274%
From 172.349 € to 287.213 €	7%	3,8361%
From 287.214 € to 550.836 €	8%	-
From 574.323 € to 1 milion €	6% (single rate)
Above 1 milion €	7,5% (single rate)
(*) at the bracket’s higher end

• Acquisition of urban real estate or an autonomous fraction of urban property, exclusively for housing.



Amount for applying IMT (en euros)	Tax rate
	Marginal	Average(*)
Up to 92.407 €	0%	0%
From 92.407 € to 126.403 €	2%	1,2689%
From 126.403 € to 172.348 €	5%	2,2636%
From 172.348 € to 287.213 €	7%	4,1578%
From 287.214 € to 550.836 €	8%	-
From 550.836 € to 1 milion €	6% (single rate)
Above 1 milion €	7,5% (single rate)
(*) at the bracket’s higher end

• Acquisition of land: 5%.

• Acquisition of other urban buildings and other costly acquisitions: 6,5%.

• 5. Acquisition of rural and urban goods when the buyer is a resident of a tax haven (except for individuals): 10%.

Portuguese law foresees a few cases for IMT exemption; such as, the acquisition of urban real estate properties in urban renewal areas when the buyer starts refurbishing works within the first two years from the purchasing date.

Additionally, ownership of real estate property in Portugal is subject to real estate taxes. Real estate property owners pay this tax annualy on December 31; the basis for its computation is the tax assets value determined by the Portuguese Finance Ministry.

Property tax varies depending upon the type of property.

• Rural property: 0,8%.

• Urban property: from 0,3% to 0,5%.

•  Properties of entities in tax havens (except individuals): 7.5%

These tax rates may increase for ruins, empty or abandonned buildings, property located in urban rehab zones, and buildings belonging to entities located in tax heaven jurisdictions. These tax rates may also decrease when the real estate property is located in an urban rehab zone and in a dessert-rescue zone, or if the property is listed as public interest, cultural heritage, or buildings rented in urban zones.

Real Estate Sector

Why invest in Portuguese real estate?

Currently, the Portuguese real estate market presents several opportunities. In fact, there is a wide range supply to match any kind of needs; such as, partial relocation to Portugal, having a vacations property or simply for speculation.

Since the 2008 crisis, several foreign investors have come to Portugal, especially due to the Golden Visa program. This has triggered real estate prices, but still within an insteresting level.

The Portuguese government has implemented incentives tax to make the real estate market more attractive.

We suggest our clients buying real estate in Portugal to contract the services of qualified professionals to verify that their real estate transaction is done properly.

Services

Fees

After analyzing the client’s expatriation/relocation project, we prepare a budget according to the services the client requests, on a case by case basis.

Regarding the Non Habitual Resident (NHR) regime, when there is no need for a specific analysis of clients’ departure from their country, we charge a flat fee according to the client’s family situation (individual or couple).

Our fees our very competitive. Our clients are informed all the time about the status of their NHR process; this follow-up is included in our initial fees. As a matter of fact, we contact the Portuguese Public Treasurer regularly to keep the NHR process up to date.

Besides, our personnel is fluent in English, Spanish, and French and always accompany our clients through their relocation to guarantee a process without problems.