The draft law of the 2024 State Budget puts an end to the Non-Habitual Resident (NHR) regime, as the Prime Minister, António Costa, had already announced, but creates a new "tax incentive for scientific research and innovation", which will allow a number of professions to continue to benefit from a reduced IRS.
The new regime will cover workers who "have not been resident in Portuguese territory in any of the previous five years", from the "careers of higher education and scientific research teachers, including scientific employment in entities, structures and networks dedicated to production, dissemination and transmission of knowledge, integrated in the national system of science and technology; qualified jobs within the scope of the contractual benefits for productive investment Research and development jobs, of staff with minimum educational qualifications at level 8 of the National Qualifications Framework, whose costs are eligible for the purposes of the system of tax incentives in research and business development", reads the OE2024 draft law.
The rate to be applied under this incentive will be 20%, for a period of 10 years, as is the case with the NHR.
The Minister of Finance, at the press conference to present the 2024 State Budget proposal, said that "there is no longer a regime of universal and transversal application", but "the conditions for attracting relevant investment to the Portuguese economy are intact", either through the reduction of corporate income tax for companies, or through the personal income tax. "It will be maintained as a mechanism for capturing structuring investment," said Fernando Medina.
For companies, the OE2024 report stresses, "the current tax regimes to support productive investment (RFAI and contractual benefits) are extended, supporting the creation of qualified jobs (with a master's degree or higher)".
The NHR ends only in 2024, which means that all processes "whose processing takes place by the end of the year, are under the current law", clarified the minister. "The government's decision is projected into the future, not into the past," he said.
The draft law reads that the regime continues to apply "to taxpayers who, on the date of entry into force of this law, are already registered as non-habitual residents in the AT's taxpayer register, until the period referred to in paragraphs 9 to 12 of article 16 of the Personal Income Tax Code has expired [ten years]" and, also, to "taxable persons who on December 31, 2023 met the conditions for registration as non-habitual residents, as well as holders of a residence visa valid on that date".
The NHR was created in 2009 and in 2012 underwent changes to attract foreign retirees to the country. Initially, these pensioners were exempt from personal income tax, but in 2020 the Government approved a 10% taxation.
** This article is for informational purposes only and should not be used to make a decision on the matter in question.
The content of the information written above was obtained mostly from the page https://www.dinheirovivo.pt/economia/nacional/governo-acaba-com-regime-do-residente-nao-habitual-mas-cria-novo-incentivo-fiscal-17143676.html.