IFICI (Incentivo Fiscal à Investigação Científica e Inovação) is Portugal's current tax incentive framework for qualifying new residents. This guide explains how it works, who is eligible, what the application process involves, and why it should not be treated as a simple rebranding of NHR.
Most rejected or delayed IFICI cases are not about intent. They are about poor sequencing and weak documentation.
IFICI offers a 20% flat rate on qualifying Portuguese-source employment or self-employment income for eligible taxpayers over a 10-year period. It was introduced as part of the legislative changes that accompanied the NHR repeal.
What IFICI is not:
Treating IFICI as "NHR 2.0" creates planning errors because people apply NHR assumptions to a framework that works differently.
IFICI eligibility is activity-dependent. Unlike NHR (which was open to virtually any new resident who had not been tax resident in Portugal for the prior 5 years), IFICI requires that you perform a qualifying activity.
Qualifying activity pathways include:
The common thread is that eligibility is not about your personal credentials alone. It is about the intersection of your activity, your entity context, and the competent authority that validates the case.
This is why two people with similar CVs can have very different outcomes.
IFICI applications involve multiple steps and stakeholders:
Your residency year drives all timing and deadline logic. If the residency year is wrong, every downstream step is wrong.
Different paths involve different competent authorities. The entity you work for, the type of activity you perform, and the sector you operate in determine which path applies.
Do not submit first and collect evidence later. The quality of your initial submission materially affects processing time and outcome.
Documentation typically includes:
The submission channel and competent authority depend on your eligibility path. Using the wrong channel or wrong entity classification creates delays.
IFICI is not a one-time application. Each year, your filing must correctly reflect IFICI treatment, and ongoing eligibility conditions must be met. Changes in employer, role, or entity context may trigger update obligations.
Portuguese tax authority guidance references specific procedural deadlines, including January 15 for several IFICI-related communications.
The operational posture should be:
Late handling can reduce effective benefit years depending on timing and how the application is processed.
| Feature | NHR (repealed for new entrants) | IFICI (current) |
|---|---|---|
| Eligibility | Any new resident, 5-year non-residency | Activity and entity-dependent |
| Income covered | Foreign-source + Portuguese qualifying income | Primarily Portuguese-source qualifying income |
| Tax rate | 20% on qualifying income; exemptions on foreign income | 20% on qualifying income |
| Duration | 10 years | 10 years |
| Application complexity | Low (residency registration) | Higher (competent authority validation) |
| Ongoing compliance | Annual filing with NHR treatment | Annual filing + eligibility maintenance |
| Foreign income treatment | Broad exemptions under specific conditions | Standard Portuguese rules (no special foreign income treatment) |
The most important difference for planning: IFICI does not provide the foreign income exemptions that made NHR attractive for passive income profiles. If your income is primarily from foreign dividends, pensions, or capital gains, IFICI may not offer the same benefit that NHR did.
Our process follows the DPIP framework:
This approach is slower than generic submission. It is faster than fixing preventable errors after the fact.
No. Eligibility depends on qualifying activity pathways and supporting evidence. New tax residency alone is not sufficient.
January 15 appears in key administrative guidance, but exact treatment can depend on residency year and transitional specifics. Validate your case before relying on generic summaries.
Not automatically in all cases. Changes in employer, role, or entity context may trigger update and re-validation obligations depending on the path.
IFICI primarily covers Portuguese-source qualifying income. Foreign pension income is generally subject to standard Portuguese tax treatment, not IFICI treatment. This is one of the key differences from NHR.
If you want a practical go/no-go assessment on your IFICI eligibility path, start with a Tax Diagnostic. We map your activity profile, entity context, and documentation gaps before any application work begins.
Last reviewed: February 8, 2026. Educational content only. Not personal tax or legal advice. IFICI handling depends on your specific facts and current administrative guidance.