Portuguese Golden Visa with tax advantages

Published at: 20/05/2019 11:02 am

Portuguese Golden Visa with tax advantages

Those applicants, who obtain their Portuguese EU resident status in exchange for investment, can plan their taxes. The Portuguese Non-Habitual Tax Regime offers a flat 20% tax rate for ten years for local revenue and an exemption for almost all foreign sourced income.

What is the Portuguese Non-habitual Tax Regime?

- Non-habitual residents in Portugal will be subject to a reduced 20% Portuguese Income Tax rate both on salaries and business and professional income of a Portuguese source if it arises from high added value activities of a scientific, artistic or technical nature.

- The non-habitual residents are exempt from the Portuguese income tax on salaries of a non-Portuguese source if the wages were subject to tax in the country of origin.

The following text is an excerpt from the Portuguese Tax authority's official brochure.

The Investment Tax Code, approved by the by Decree-Law no. 249/2009 of 23 September created the fiscal regime for the resident not resident in the Tax Office on the Income of Individuals (IRS), to attract to Portugal non-resident professionals qualified in activities with high added value or intellectual property, industrial or know-how, beneficiaries of pensions obtained in the foreign.

When should the citizen apply to register as a non-habitual resident?

The application for registration as a non-habitual resident should only be done after registered as resident in Portuguese territory. In case you already have the Portuguese Tax Identification Number (NIF) but registered as a non-resident, you must first apply for a change of address and resident status, with any office of the "Serviço de Finanças" or "Loja do Cidadão". Deadline: The application for registration, as a non-habitual resident, must be made not later than 31 March of the year following that in which he becomes a resident of the territory.

What right does the citizen acquire that is considered a non-habitual resident?

A citizen who is considered to be a non-habitual resident receives the right to be taxed as such in the period of 10 consecutive years from the year, inclusive, of their registration as a resident in national territory, provided that in each resident in that country. This 10-year period is non-extendable.
It should be emphasized that the enjoyment of the right to be taxed as a non-habitual resident, in each year of the period, depends on being, in that year, considered resident in Portuguese territory.

In cases where the citizen has not enjoyed the right to be taxed according to the tax regime established for non-habitual residents in one or more years of that period of 10 years, may resume the enjoyment of the same right in any of the remaining years of that period provided that it is again considered resident for IRS purposes."

Click here for more information about the Portuguese Golden Visa Program!


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