Portugal NHR After 2024

What This Guide Covers

Portugal repealed the Non-Habitual Resident (NHR) regime for new entrants effective January 1, 2024. This guide explains what happened, who still qualifies under transitional rules, what replaced NHR, and how to plan your tax position in 2026 without relying on outdated assumptions.

If you are reading conflicting summaries online, you are not imagining it. Most confusion comes from people mixing three different things: the legal repeal date, transitional eligibility windows, and the practical tax treatment in current-year filings.

What Actually Happened to NHR

The NHR regime was created in 2009 to attract new residents to Portugal with preferential tax treatment on certain income types for a 10-year period. It was repealed for new entrants as of January 1, 2024.

At the same time, Portugal created transitional provisions so specific taxpayers who had already started their relocation process could still access NHR treatment under defined conditions.

The key practical point is straightforward:

• If you were already properly registered as NHR before the repeal, your regime does not disappear overnight.
• If you were not registered and do not meet transitional criteria, NHR is not available in its original form.

Who Can Still Use NHR in 2026

In 2026, there are generally three groups of taxpayers in relation to NHR:

1. Existing NHR holders

If you registered for NHR before the repeal date, your regime typically continues through the remainder of your original 10-year period. This is subject to meeting ongoing requirements and maintaining filing consistency each year.

The practical concern for this group is not losing the regime. It is ensuring that annual filings correctly reflect NHR treatment and that the position remains defensible if questioned.

2. Transitional applicants

Some taxpayers qualified under transitional rules tied to prior links with Portugal or specific timing conditions. In practice, this is where documentation quality determines outcomes.

Transitional eligibility is not something you can assume. It needs to be validated against the specific criteria and supported with evidence.

3. New arrivals after the transition window

Most new arrivals in 2025 and 2026 should plan under the current post-NHR landscape. That means either the standard Portuguese tax regime or, where eligible, the newer IFICI incentive framework.

Planning based on old NHR blog posts from 2021-2023 is one of the most common and expensive mistakes I see in diagnostics.

What Replaced NHR: The IFICI Framework

Portugal introduced the IFICI (Incentivo Fiscal à Investigação Científica e Inovação) regime as part of the broader legislative changes. IFICI offers a 20% flat rate on qualifying Portuguese-source employment or self-employment income for eligible taxpayers.

IFICI is not "NHR 2.0" in any practical sense. The eligibility logic is different, the qualifying activities are different, and the operational requirements are different. Treating them as equivalent creates planning errors.

Key differences from NHR:

• Activity-dependent eligibility. NHR was available to almost any new resident. IFICI requires qualifying activity pathways tied to specific professional or institutional contexts.
• Income scope. NHR covered foreign-source income broadly. IFICI primarily targets Portuguese-source qualifying income.
• Competent authority validation. IFICI applications involve entity-level or activity-level validation that NHR did not require.
• Documentation burden. IFICI demands stronger upfront evidence and ongoing compliance than NHR did in practice.

For a detailed guide on IFICI eligibility and application, see our IFICI practical guide.

How NHR Worked: A Summary for Context

For reference, NHR provided two main benefits during its 10-year term:

1. Foreign-source income. Certain categories of foreign income (pensions, dividends, interest, royalties, capital gains, employment income) could be exempt from Portuguese tax or taxed at a reduced rate, depending on the income type and whether Portugal had taxing rights under the applicable treaty.
2. Portuguese-source qualifying income. A 20% flat rate applied to Portuguese-source income from qualifying high-value activities.

The regime was attractive because it was relatively simple to qualify for (new resident, not tax resident in Portugal for the prior 5 years) and covered a broad range of income types.

That simplicity is exactly what the post-NHR environment no longer offers.

The Mistakes I See Most Often

After reviewing hundreds of NHR and post-NHR cases, these errors come up repeatedly:

• Assuming old NHR rules still apply automatically. They do not, unless you are an existing registered holder or meet transitional criteria.
• Using relocation checklists from 2021-2023 without date checks. Rules changed materially. Outdated guidance creates false confidence.
• Missing filing-year timing interactions. The relationship between move date, residency start, and regime status is more complex than most summaries suggest.
• Treating home-country advice as if Portuguese qualification rules were unchanged. Your UK or US advisor may not be tracking Portuguese legislative updates.
• Confusing NHR and IFICI eligibility. They are different frameworks. Qualifying for one did not and does not mean qualifying for the other.

None of these are fatal if caught early. They become expensive when discovered after filing.

How to Plan Your Tax Position in 2026

The better approach is not to chase regime labels. It is to build a defensible filing position year by year.

Use this sequence:

1. Confirm your tax residency timing and status.
2. Determine which regime path applies under current rules (existing NHR, transitional NHR, IFICI, or standard regime).
3. Map your income categories before filing season pressure begins.
4. Align Portuguese treatment with your home-country reporting obligations.
5. Document every material assumption in writing.

That is exactly why we run a Tax Diagnostic first. You need a clear map before any return is prepared.

What This Means for Expats and Cross-Border Families

The post-NHR environment is not necessarily worse for everyone. For some profiles, standard Portuguese rates combined with proper treaty application and credit mechanics produce reasonable outcomes.

What has changed is the margin for error. Generic advice that worked under NHR (where the regime itself compensated for imprecise planning) does not work in a standard regime environment where every classification and timing decision matters.

If your profile includes business income, cross-border pensions, equity compensation, or foreign entities, your result depends more on classification and sequencing than on regime headlines.

NHR Expiry: Planning for Existing Holders

If you are currently in your NHR period and approaching expiry within the next 2-3 years, planning should start now. The transition from NHR rates to standard Portuguese rates can be significant, especially for:

• Pension income that was exempt or taxed at a flat rate under NHR.
• Foreign dividend and interest income that benefited from exemption.
• Capital gains that were not taxed in Portugal under NHR provisions.

Pre-expiry planning is not about finding another regime. It is about restructuring income timing, disposal sequencing, and treaty application to manage the transition.

FAQ

Is NHR still open for new applicants in 2026?

As a general rule, no in its original form. The regime was repealed for new entrants from January 1, 2024, with transitional treatment only for defined cases that met specific prior conditions.

If I already have NHR, do I lose it?

Not automatically. Existing registered holders generally continue through their original 10-year period, provided requirements remain satisfied and filings are consistent.

Is IFICI the same as NHR?

No. IFICI has different eligibility logic, different qualifying activities, different income scope, and different operational requirements. Do not assume one-to-one equivalence.

What should I do before my next filing?

Confirm residency timing, regime position, and income classification early. Then coordinate Portuguese and home-country treatment before returns are submitted. If you want a structured review of your timeline and regime exposure, start with a Tax Diagnostic.

Last reviewed: February 8, 2026. Educational content only. Not personal tax or legal advice. Tax outcomes depend on your facts, filing history, and applicable law.