Portugal's IFICI: The New "NHR 2.0" Regime
Previously, in the opening piece of our editorial series exploring the main favourable tax regimes around the world, we focused on the Tax Holiday available to new residents in Uruguay.
In this article, we turn to one of the most sought-after destinations for Brazilians planning to leave Brazil: Portugal. The broad Brazilian interest in the Portuguese homeland is explained by, among other factors, the absence of a language barrier, public safety, access to the European Union, the historical and cultural ties with Brazil, high quality-of-life indicators, and the accessibility of its education and healthcare systems.
In December 2024, Portugal regulated a new favourable tax regime called IFICI (Incentivo Fiscal à Investigação Científica e Inovação, or Tax Incentive for Scientific Research and Innovation). The main purpose of the IFICI is to attract highly qualified professionals to the Portuguese economy, fostering domestic growth based on knowledge, technological innovation and digital transformation.
Popularly known as NHR (“Non-Habitual Resident”) 2.0 because of its similarities to the former NHR, the IFICI grants an exemption from taxation on most foreign-source income for a period of 10 years. The exemption even allows income generated abroad to be brought into Portugal, as it is not a remittance-based tax system.
However, since the regime was designed to attract people of working age, foreign pensions do not benefit from the exemption. Nor is income paid by entities domiciled in “blacklisted jurisdictions” exempt, that is, countries, territories or regions regarded as tax havens under Portuguese regulations. The list currently includes 77 jurisdictions, among them the Bahamas, Belize, the Cayman Islands, the British Virgin Islands, Jersey and Panama. It should be noted, however, that this list is under review. Since 1 January 2026, Hong Kong, Liechtenstein and Uruguay have been removed from it, and the Portuguese government has already proposed further amendments to bring it closer to the EU list of non-cooperative jurisdictions. It is therefore advisable to check the version of the list in force at the time of planning.
In addition to the exemption on foreign income, the regime also offers a favourable flat rate of 20% on income from qualifying professional activities carried out in Portugal (as detailed below). This benefit is highly significant considering that the progressive rates normally applicable to employment income can reach 48%. Higher incomes are also subject to the additional solidarity rate (taxa adicional de solidariedade, or TAS) of 2.5% on the portion between €80,000 and €250,000 and 5% on the amount exceeding €250,000. With it, the top marginal rate can reach 53%.
To be eligible for the regime, the applicant:
must not have been a tax resident in Portugal in any of the 5 years preceding the change of residence;
must not have previously benefited from the original NHR or from the IFICI itself, nor have opted for the tax regime of the Programa Regressar (Return Programme);
must become a tax resident in Portugal;
must carry out, in Portugal, a professional activity that falls within one of the qualifying routes set out in the law, linked to an entity (a company, university, research centre, etc.) that also meets the requirements of that route; and
must file the registration application by 15 January of the year following the year in which they become resident.
There are six routes of access to the regime. Each has its own requirements and a designated entity responsible for reviewing the application:
Teaching and scientific research: teaching in higher education and scientific research at entities integrated into the national science and technology system, including recognised technology and innovation centres (reviewed by FCT – Fundação para a Ciência e a Tecnologia, the Foundation for Science and Technology);
Productive investment with contractual benefits: qualified jobs and members of corporate bodies in companies that enter into a formal investment agreement with the Portuguese State and receive tax incentives to meet certain objectives, such as investment volume or job creation (reviewed by AICEP – Agência para o Investimento e Comércio Externo de Portugal, the Portuguese Agency for Investment and Foreign Trade);
Highly qualified professions: professions such as managing director and executive manager, engineer, physician, university professor and information and communication technology specialist. These professions must be carried out (i) at companies that benefit or have benefited from the Tax Regime for Investment Support (Regime Fiscal de Apoio ao Investimento, or RFAI), or (ii) at industrial and service companies in certain sectors that export at least 50% of their turnover in the year the professional starts working or in either of the two preceding years. Under this route, the professional must hold at least a doctorate or a bachelor’s degree with three years of proven professional experience, and it is up to the company to confirm compliance with the requirements before the Tax Authority;
Activities relevant to the national economy: qualified jobs at entities whose activities are recognised by AICEP or IAPMEI (Agência para a Competitividade e Inovação, the Agency for Competitiveness and Innovation) as relevant to the Portuguese economy. Both agencies have published their own, fairly broad lists of eligible professions and activities;
Business research and development: R&D staff whose costs are eligible under the tax incentive system for business research and development (SIFIDE) (reviewed by ANI – Agência Nacional de Inovação, the National Innovation Agency);
Certified startups: jobs and members of corporate bodies at startups certified by Startup Portugal.
By combining the exemption on foreign income for up to 10 years with a favourable 20% rate on income from qualifying employment as described above, the IFICI offers an excellent window of opportunity for establishing residence in Portugal, as well as for broadening international tax, wealth and estate planning strategies.
Lorusso & Partners continues to monitor all developments in the regulation of the new IFICI and remains available to assist you in transferring your tax residence to Europe. Our team is also supported by lawyers specialised in local tax and immigration matters to facilitate communication with the destination jurisdiction.
