Non Habitual Residence (NHR) Portugal tax regime for expats (2021)

IMPORTANT – PLEASE READ REGARDING THIS CHANNEL

The content on this channel is for educational and information purposes only. It should not be relied on as advice, and you should always take qualified advice before making any changes to your personal position.

Whilst I have experience in the financial and tax industry, this channel is for recreational purposes and is not an advertisement for my business or services. Its purpose is to share quality information.

Whilst every care is taken as to the accuracy of the information in these videos, the information provided is based on the understanding of the rules at the time, and rules can change with little or no notice.

Whilst I cover a wide range of issues on the channel, in my professional role I specialise in tax efficient investments, UK and overseas pensions, estate planning, and wealth management for expatriates based in Portugal. Unfortunately, I do not offer visa or tax return services, nor can I assist US nationals.

*Thank you for your support and understanding. I hope to continue to provide you with valuable information to help you with your life in Portugal. If you have any suggestions for content you would like to hear, please let me know*

The Non Habitual Residence program is a 10 year tax incentivised scheme.

The scheme was introduced in 2008 and has been a great success in attracting new residents to the country.

It may be possible, with correct structuring, to live here tax free.

The NHR tax regime offers the following;
• 20% flat rate for Portuguese employment and self employment income from ‘high value activities’ – please see list below
• 0% Employment income from outside Portugal is not subject to taxation in Portugal if it is taxed in the source country;
• 0% Self-employment income from a high-value activity sourced outside Portugal is not subject to taxation in Portugal, provided that income may be taxed (even if not effectively subject to taxation) in the source country under a double taxation treaty (DTT) signed between Portugal and that country; and
• 0% tax on foreign dividends, interest and rent are exempt in Portugal if they may be taxed in the source country. If taxed in the source countries the tax so charged shall not exceed the reduced rates established in the tax treaties, usually of 5%, 10% or 15%
• 10% flat rate of tax on foreign pensions
• 0% CGT if may be taxed according to the DTT

There is no specific provision under the NHR scheme covering crypto gains, but by becoming NHR you are able to take advantage of Portugal's tax free gains on crypto assets.

Please see a link to my video on crypto currencies and tax in Portugal.

NHR and visas

People are sometimes confused between residency, tax residency, legal residency, NHR and visas.

For example, some people have asked me: "should I apply for the Golden Visa or NHR?" and I explain to them that they are not alternatives - the NHR is a special status of resident that you can apply for AFTER you have gone through the Golden Visa, D7 visa, D2 visa etc. process.

So the visa is a ROUTE to NHR status.

The process is very simple in this order:

#nonhabitualresidence #NHR #d7visa #goldenvisa #movingtoportugal

[taxfinancialadviceinportug]

IMPORTANT – PLEASE READ REGARDING THIS CHANNEL

The content on this channel is for educational and information purposes only. It should not be relied on as advice, and you should always take qualified advice before making any changes to your personal position.

Whilst I have experience in the financial and tax industry, this channel is for recreational purposes and is not an advertisement for my business or services. Its purpose is to share quality information.

Whilst every care is taken as to the accuracy of the information in these videos, the information provided is based on the understanding of the rules at the time, and rules can change with little or no notice.

Whilst I cover a wide range of issues on the channel, in my professional role I specialise in tax efficient investments, UK and overseas pensions, estate planning, and wealth management for expatriates based in Portugal. Unfortunately, I do not offer visa or tax return services, nor can I assist US nationals.

*Thank you for your support and understanding. I hope to continue to provide you with valuable information to help you with your life in Portugal. If you have any suggestions for content you would like to hear, please let me know*

[christinewatts]

Very clear, good information this will help us as we intend to retire to Portugal from the USA.

[SkulldErX]

Mark, those are some valuable pieces of information, thank you for that!
It was interesting to hear that crypto is not currently taxed in Portugal. Would you consider making a dedicated video specifically to crypto taxation in regards to simple crypto-fiat sale, earning crypto interest from DeFi solutions which is consequently converted to fiat etc? It would be also very useful to know (if you are aware of such thing) what is the current political mood around crypto in Portugal, are there any bills/regulations which are being discussed, including possible future crypto taxation.
Thanks a lot again and have a great day!

[alphaaquisitions]

Thank you very much for this valuable information.

[ryansessel]

Hi Mark, very informative video. How would it work with dividends from a dubai free zone company?

[alanendurace]

hi Mark, great video again and subscribed.
if i get a director income from a foreign company, i understand this income is taxed 20% in Portugal + social contribution.
This income is but already taxed 10% at the source in the source country (CH), does that mean it becomes tax free or that's only applicable for other income sources (dividends, interest, ...)?
Thanks!

[matiasayrtonperezcagegi]

Hi Mark, very interesting video! And enjoyable as well, full of information and different cases to apply. As a future worker with a high value activity, I am moving to Portugal next month. Do you know if there is any time limit to ask for this? Some webpages say there is a deadline on the 31st of March, so that I would have to sign a house rent contract and ask for the NHR before this day, but I cannot be sure. Thanks beforehand and all the best to your channel!

[cookmaster]

Hi Mark - Very Informative video. The tax stuff is the most difficult one to figure out. Let us say a retiree US citizen with $100k income from all sources (pension, soc security, Dividends, cap gain, retirement withdrawals like 401K) comes on a D7 visa, he is by default a Portuguese taxable resident and all the above said income is taxable in Portugal. He has to file his taxes in US and Portugal both. Obviously his tax liability in Portugal will be higher than US. Does he get to choose which country he pays his taxes to?. Is there a TIE BREAKER rule that applies where Portugal will exercise the power to collect taxes in Portugal and thus D7 visa holder ends up paying a huge tax bill. On the other hand if he upon getting a D7 visa converts to NHR status, he still owe taxes on all the income but now at 20% right?. Can you shed some light on ten tax situation in this scenario. Thanks

[humanise.]

Hi there, great video. Just wondering if I could do this self employed as a personal trainer, starting up in Portugal but uk citizen?

[JasonWilkes]

hi Mark, I am interested in the NHR, living in Spain for 20 years, have a UK company. Looking to take a higher salary from the UK. I can not find anything "solid" regarding tax on world wide salary. It all seems very vague. I could take dividends but obviously salary is more beneficial. I have Portugal as our first option due to EU residency, 2nd is Gibraltar but obviously ltd movement in the EU! Thanks Jason.

[seekbeautytravel]

Hi Mark, thanks for the video, very interesting and promising. Do you know if Google Adsense earnings from the ads on my website received outside of Portugal would qualify for NHR tax free?

[ytphil]

Many other sources say that capital gains and dividend income from outside of portugal or earned outside of portugal, are not taxed in portugal. Can anyone explain why he said they are?

[AdamJamal]

What if I am on a UK salary but completely remote, and I want to continue getting paid in Britain, and then claim the tax back at the end of the tax year? Would I pay zero tax in Portugal if I spent 6 months of the year in Portugal with all my employment income being in the UK, thus paying no tax at all?

[Dailydoseofogfortnite]

Dear Mark,

We’re a couple from Denmark running an online business selling in Denmark. We can work online and are not bound to work in one place. As we understand it, it’s not possible to get 0% tax in the NHR program if you’re a leading role in the foreign business(director).
If we step down from the director post and hire someone else as our director and take a lower job in the company, we won’t be a leading role anymore. Will our monthly income from the company in Denmark then be taxed at 0% in Portugal under the NHR?

Essentially our goal is to live in Portugal and not pay taxes.

Thank you!

[Istark]

Hello Mark. First of all, thanks for all the info you provide regarding NHR. I wanted to ask you a few questions if you don't mind:

1) I'm currently working as a software engineer for a blockchain company and getting paid in stablecoins. Would a crypto wallet be enough as a proof of income, or would I need a Wise account with funds? (bank deposits are not an option where I live).

2) From the info I gathered, because of my profession I'd qualify as a high value worker and be capped for 20% regarding taxes for the first 10 years. So let's say I earn 100k usd yearly, I'd have to pay 1.6k each month? Or are there any other taxes to take into account? Because I think I read something about some end of year taxes, but I'm not quite sure.

Thanks!

[jacklarkins]

Hi Mark, thank you for the video! I had a question I'm trying to get my head wrapped around.

If I have an offshore company in Estonia and take dividend out whilst under the NHR scheme from what I understand it's 0 tax in Portugal. But in Estonia it's 20% flat for dividend. However due to living in Portugal will I not have to pay that 20% because off the double taxation treaty?

As even though it's 0% tax in Portugal I'm still processing my taxes in Portugal.. hope this makes sense!

[ramyap]

This is a great informative video!! Thanks for explaining. I'm from India, and I got a job offer (software developer) in Portugal and I'm planning to move there next year. Will the taxes be the same in the upcoming years? I'm told that I'll be levied with 45% taxes and 11% social security from my monthly salary. Am I eligible for NHR? If yes, I understand that from my monthly salary, 20% would be deducted for taxes instead of 45%? Please reply.

[ahmes]

Hello Mark, I have an American LLC and I live in Belgium. I would like to expatriate to Portugal with the NHR. Should I pay taxes on my income? Thank you.

[kerryblaine]

Hi Mark, I am a US citizen wanting to move to Portugal and get the NHR. As a Us citizen I can not give up my tax residence with out giving up my passport, So I guess I will have to pay US taxes and some taxes in Portugal. Should I sell all my growth stocks and change them to dividend stocks? I also have a US rental apartment and a small pension. I would have to pay taxes in Portugal on my pension only. Is this correct?? Thank You. Kerry

[K_H-Channel]

Hi Mark, thanks for the valuable info. I have a question if you don’t mind. I’m a canadian and work as a software engineer manager in Canada. I’m employed permanent/full time. If I go on D7 to Portugal, should I change my employment to a contract? And how would I get taxed? I would like to pay low tax in Portugal instead of high tax in canada for my income if possible. TIA