Applying for non-habitual resident status in Portugal

Non-Habitual Resident Status Tax Benefits

If you are thinking about moving to the Algarve permanently and are willing to register Portugal as your taxing country you may be eligible for some very attractive tax benefits by obtaining non-habitual resident status. 

Non-habitual resident status in Portugal affords certain tax advantages to those who transfer their residence for tax reasons to the country. 

Many foreigners are already taking advantage of these financial benefits and paying much less in taxes than they would be in their home country.

To gain the status of a non-habitual resident is quite straightforward and only involves completing an application process with multiple stages. 

What are the benefits of being a non-habitual resident in Portugal?

If you are a foreigner moving to the country and choose to change your tax residency to Portugal, you can apply for a non-habitual resident status. With that, you will be entitled to tax advantages over 10 years.

Coming to the Algarve to Work?

If you planning on coming to the Algarve to work, you can benefit from a fixed rate of income tax (IRS) of 20%. 

This reduced rate applies to all professionals with highly qualified skills. The list of professions is quite diverse and includes professionals such as doctors, tax advisors, architects, senior executives, designers and teachers.

Thinking of Retiring in the Algarve?

If you are receiving a pension in your home country, you are also able to benefit from the non-habitual resident status. All pensions paid from outside of the Algarve, but received in Portugal, are exempted from IRS payments. 

At present Portugal exempts retirees from paying taxes on pensions received outside of the country.

To find out if you are covered by this exemption, consult the Portuguese Tax Authority (Finanças) for a list of all the requirements currently in force regarding this status.

Requisites for Non-Habitual Resident Status in the Algarve?

The Non-habitual resident status can be applied for by anyone who meets these three requirements. 

• You must live abroad. 
• Must not have been a resident in Portugal within the last five years. 
• Be planning to move to Portugal. 

To be considered a resident means you must remain in Portugal for 183 days a year or have your permanent home there.

How to get non-habitual resident status in Portugal?

The applicant must register as being resident in Portugal at your local tax office (Finanças) or a citizen’s service bureau (Loja de Cidadão). 

After receiving your tax identification number, you then need to submit an application to register as a non-habitual resident in the same location, or you can do it through the tax authority website (Portal Das Finanças).

In order for your application to be valid, you must submit it before March 31st of the following year of becoming a resident in Portugal.

To Conclude The Process

1. Get Registered as a resident in Portugal at your local tax office and get a tax identification number;

2. Fill out the online form and receive your password to gain access to the tax authority website;

3. After receiving the password which will be delivered to your address by mail, you can then register as a non-habitual resident through the tax authority website;

4. You can follow the progress of your application until it is accepted on the same site;

5. You will then receive confirmation in your online account on the website in PDF format which you can download, print and keep safely stored.

6. If you have a professional job you need to submit a certified copy of proof of your profession to:

Direção de Serviços de Registo de Contribuintes

Avenida João XXI, 76, 6th

1049-065 Lisbon Portugal