In 2009, against the background of the global financial crisis, the low qualification level of the country’s active population and increasing unemployment, the Portuguese government changed tax law to attract foreign investors and immigrants in the form of qualified professionals and retirees.

Law No. 249/2009 of 23 September approved the Investment Tax Code and the new personal income tax regime IRS for non-resident individuals – Não Habitual Residente, abbreviated NHR. And the areas of economic activity for which tax exemptions are available have been defined.

Tax office in Cascais

So, who is a non-permanent resident?

To declare oneself as a non-permanent resident, one must first become a tax resident by fulfilling one of the conditions.

Residents of Portuguese territory are persons who, in the year to which the income relates:

– Resided in Portuguese territory for 183 consecutive days or at an intermediate interval during any 12-month period beginning or ending in the year in question;

– Resided for a shorter period but have a dwelling that they expect to occupy as their usual place of residence (rental or ownership);

– 31 December were members of the crews of ships or aircraft, provided that they were in the service of persons domiciled, headquartered, or effectively managed in Portuguese territory;

– Performed public functions or assignments abroad in the service of the Portuguese State.

Non-permanent residents in Portuguese territory are persons who, after becoming tax residents, did not reside in Portuguese territory in any of the previous five years. A non-permanent resident acquires the right to benefit from preferential tax treatment for 10 consecutive years from his registration as a resident in Portuguese territory.

According to paragraph 12, article 16 of the CIRS, a taxable person registered as an NHR who did not exercise this right during one or more of the years included in the 10-year period may resume exercising it in any of the remaining years. You may use the more favorable income tax treatment at your discretion.

The IRS preferential income tax treatment applies to:

1.     Portuguese source income

2.     Foreign source income:

– Category A income-dependent work.

– Category B income – independent work, Category E income – capital, Category F income – property and Category G income – capital gains.

– Category H income is pensions.

– Other income earned abroad.

The waiting room at the tax office in Cascais

List of occupations:

Classification of occupations and economic activities in which tax exemptions are granted, Portaria regulation n.º 12/2010, de 7 de Janeiro, as amended:

1 – Professional activities (occupational classification numbers according to the codes of CPP 2010, Classificação Portuguesa das Profissões):

112 – General directors and executive directors of companies.

12 – Directors of administrative and commercial services.

13 – Directors of production and specialized services.

14 – Directors of hotels, restaurants, retail and other services.

21 – Specialists in physical, mathematical, engineering, and related technical sciences.

221 – Doctors.

2261 – Dentists and dentists.

231 – University and higher education teachers.

25 – Information and communication technology (ICT) professionals.

264 – Writers, journalists, and linguists.

265 – Artists in the creative and performing arts.

31 – Mid-level technicians and specialists in science and technology.

35 – Information and communication technology specialists.

61 – Farmers and skilled agricultural and livestock workers.

62 – Skilled workers in forestry, fisheries, and hunting.

7 – Skilled workers in the industry and construction, including skilled workers in metallurgy, metalworking, food processing, woodworking, clothing manufacturing, printing, precision tool manufacturing, jewelers, artisans and electricians.

8 – Plant and machine operators and assembly workers.

Workers in all the above occupations must qualify below level 4 of the European Qualifications Framework or level 35 of the International Standard Classification (vocational education and training) or have five years of professional experience duly attested.

2 – Other professional activities:

Directors and managers of companies promoting investments provided that the Investment Tax Code performs the activity approved by Decreto -Lei n.º 162/2014, de 31 de Outubro.

IRS gross income tax rates:

Category A and B income derived in Portugal if derived from activities in which a preferential tax regime is provided – 20%.

Income from foreign sources, including interest, dividends and royalties – 0%, provided that a convention is concluded on the elimination of double taxation by Portugal with this State.

Pension income from foreign sources – 10%.

Working hours of the tax office in Cascais


The taxable person must apply for NHR registration electronically on the Financial Portal at after registering as a resident in Portugal by and including 31 March of the year following the beginning of residency.

All Portuguese residents are required to declare their worldwide income annually for tax purposes. Failure to comply with annual tax reporting obligations is subject to criminal penalties. Residents with NHR status are not exempt from reporting obligations.

Contact us if you have any questions. The Good Portugal team can take care of any nuances.