Prepare for the future and understand the tax implications of moving to Portugal
Moving to Portugal: Tax incentives
If the breathtaking landscapes, paradisiacal beaches, historical heritage, unique gastronomy and, of course, the welcoming people are not enough, get to know our tax system and the opportunities it can offer.
The different tax advantages for those who move to Portugal
Youth PIT regime (“IRS Jovem”)
- PIT exemption (from 25% to 100%) on employment and self-employment income for people up to the age of 35 and for the first 10 years of income.
- Exemption limited to €28,737.50 in 2025.
- It cannot be combined with other special tax regimes (NHR, IFICI, special regime applicable to former residents).
- The individual must have the respective tax situation regularised.
Portugal as the perfect destination for people of all generations. The Youth PIT regime aims to promote the financial autonomy of young people and to retain them.
Tax Incentive for Scientific Research and Innovation (IFICI)
- The Tax Incentive for Scientific Research and Innovation (IFICI) provides the following benefits:
- Reduced rate of 20% applicable to employment income and self-employment income arising from the exercise of one of the eligible activities.
- Exemption for foreign source income, except for pensions and income from “tax havens”.
- The regime is valid for 10 consecutive tax years, and its application is contingent upon the verification of the following conditions in relation to the individual:
- Qualifies as tax resident in Portugal in a given year.
- Has been non-resident in Portugal for the 5 years prior to moving to Portugal.
- Carries out an eligible activity.
For more detailed information, access our page about the Tax Incentive for Scientific Research and Innovation (IFICI).
Special regime for former residents
- The regime applies to taxpayers who become tax residents of Portugal between 2024 and 2026, provided they were not considered residents in Portugal during any of the five years preceding their residency and were residents in Portugal at any time before those five years.
- Exclusion from taxation of 50% of employment and self-employment income, with a maximum limit of €250,000 for the excluded amount, for taxpayers who became tax residents in 2024 or later.
The regime provides an exclusion from taxation of 50% of employment and self-employment income for a 5-year period. All other income is taxed in accordance with the general rules.
Regime applicable to self-employed persons
- Possible application of the “simplified regime”, where taxable income is determined by applying a coefficient to gross income, which varies according to the activity carried out.
- The coefficients consist of a presumption of expenses incurred in carrying out the activity.
- In the first two years of activity, and provided certain conditions are met, these coefficients may benefit from a reduction of 50% and 25% respectively, reducing the taxable income.
- As a rule, if certain conditions are met, no social security contributions are due for the first 12 months of activity.
Under the regime applicable to self-employed workers, income derived from the exercise of an activity as a self-employed worker can benefit from particularly favourable tax treatment in the first years of activity.
Pension funds and other life insurance products (including unit-linked life insurance)
- Unit-linked life insurance, pension funds and other retirement savings plans can benefit from an advantageous tax regime.
- When income is received, the positive difference between the amounts invested and the amount received is generally subject to tax at a rate of 28%. However, for "front-ended" life insurance policies, the effective rate may be reduced to 22.4% or 11.2%, depending on the number of years that have passed between the contract was set up and the date of redemption, or maturity of the policy.
- Income generated within the insurance will not be subject to taxation until it is redeemed.
There are different savings and investment alternatives, such as pension funds and other insurance products, like unit-linked life insurance, which have a beneficial tax treatment.
Inheritance and gift tax
- Tax exemption on gifts or inheritances to spouse, descendants or ascendants.
- Exclusion of tax on free transfers of assets, by gift or inheritance, due to the application of territoriality rules, or liability to a flat 10% Stamp Tax rate.
Wealth taxes
- No wealth tax.
Immigration - Residence permit application
Different alternatives for obtaining a residence permit in Portugal:
- Golden visa: subject to eligible investment
- Passive income earners (D7)
- Carrying out a professional activity
- Digital nomads (D8)
Other relevant aspects of the Portuguese tax system
- Portugal benefits from the non-discrimination rules within the EU regulatory framework, as well as from the approximately 80 double tax treaties in force with Portugal.
Why should Portugal be on your list of destination alternatives?
Portugal is part of the European Union, the Eurozone and the Schengen area. With a stable political and social environment, a safe society, a highly qualified workforce fluent in English and an excellent quality of life, it is no surprise that Portugal is becoming a top choice for anyone wishing to reside in the European Union.
If you want to add to this an extremely competitive tax regime, Portugal should not just be on your list of options, it should be at the top of it.
Why Portugal?
Geostrategic position
Between Europa, América and África
5 Years
Best city for a getaway in the world
7th Position
No Global Peace Index
15th Position
On quality of life for expats
10
Airports
7 Years
Best Golf Destination in the World
6th Position
No English Proficiency Index
3 Years
Best tourist destination in the world
How can we assist?
- Comprehensive analysis of the tax implications of moving to Portugal, particularly taking into account the potentially applicable special tax regimes.
- Assistance with the tax registrations before the Portuguese tax authorities and with the application for the tax incentive for scientific research and innovation (IFICI), as well with other special tax regimes.
- Assistance with the compliance with tax obligations, including the preparation and submission of annual Portuguese income tax returns.
- Regular tax advisory services on tax and social security matters in Portugal.
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