Now that NHR 1.0 is gone for good, I’m creating this thread for quintessential discussion on NHR 2.0 - How to be eligible, application process and implications, along with other tax optimization tips in regard to the regime.
This ground has been covered in other threads, but a couple key things:
- If you’re planning to stop working in the next 10 years, note that NHR 2.0 requires you “demonstrate that you carried out the qualifying activity and generated the corresponding income” every year (see my earlier post) that you hope to benefit from it.
- The current stipulations for which professions or “50%+ export” companies that are eligible are really quite demanding (example article here). And given how horrific Portuguese bureaucracy generally is, the prospect of having to re-certify your eligibility with the “competent entity” and Finanças every year also sounds ugly.
The GV promoters are of course making NHR 2.0 sound wonderful, but it will be interesting to see how many people actually find it worth pursuing.
Wow that’s sounds ultra bearish. But only because of hellish bureacratic landscape and the response times i’ve seen so far.
With enough capital, like through VC investment route, one can obtain this qualification but it’s definitely a lot more expensive than just applying for it in the case of NHR 1.0.
But either ways, do i read it right that capital gains are taxed 0 under the new scheme?
I believe so, but I’m not a tax expert! Here’s a few good articles I’ve come across recently re: NHR 2.0 (IFICI)
1 Like
I’m also starting to see articles admitting that NHR 2.0/IFICI isn’t all sunshine and roses - like this one:
TPN/Lusa, 20-Feb 2025 - “Tax regime for new residents criticised”
- João Magalhães Ramalho, from the Tax Department of Antas da Cunha Ecija: registration with IFICI depends on several requirements, such as the profile and nature of the employers’ activity, the taxpayer’s academic and professional history, and the nature of the profession to be exercised. “Furthermore, the right to be taxed by the IFICI depends, each year, on the taxpayer continuing to earn income resulting from the exercise of the relevant activities (the interruption cannot be longer than six months)”
- LuĂs Leon, from the consultancy Ilya, also points out the fact that IFICI requires a "double criterion - eligible employer and eligible profession - making it “much more restrictive”, in addition to excluding all retirees.
- …At the same time, he says, there is less than a month left for people to be able to sign up [for 202
4], but the platform for this does not yet exist. [OMG this is sooo Portugal!]
- Patrick Dewerbe, from Pena & Arnaut Advogados, also has reservations: "15 years after the approval of the RNH, we have gone from a simple and easy-to-apply regime to a regime that is complex and difficult to explain to potential candidates."
New overview from EY out. Of note:
- on 20 February 2025, the official forms for registering under the Tax Incentive for Scientific Research and Innovation were published. [with barely a month left for people wanting to sign up for the 2024 tax year]
- To access the new incentive, two separate eligibility assessments are necessary: one for the entity and another for the individual. Given the ever-changing landscape, the eligibility assessment for the entity is dynamic and continuously updated, making consultation with a professional that much more important in supporting the taxpayer’s registration and documentation needs.
I think that’s the point, NHR one was very unfair to normal Portuguese-born citizens who weren’t eligible for it and have to pay much higher taxes than the rich foreigners moving in.
Most countries don’t have anything like NHR.
For those applying for the 2024 tax year, seems you have until 31 March now - given that the application forms weren’t even ready until 20th February.
I doubt anyone in this forum is applying for it yet. I’d be highly curious to know their experience, if they do. Thanks for sharing though, you are a lifeline of this forum
1 Like