Portugal Non Habitual Resident Tax Law

Investors buying real estate in Portugal can benefit from the recent introduction of the Portuguese non-habitual resident tax law.

The law allows tax exemption for foreign-source income (pension, rental, income, capital gains, interest, dividends, as well as other
investment income), provided certain conditions are met.

In general terms, a person is deemed to be tax resident in Portugal if he spends more than 183 days in Portugal during the calendar year.

The legislation provides for exemption on foreign pension income subject to satisfying certain double taxation criteria.

It means many international investors from outside of Europe seeking a golden visa and eventually choosing to become permanently resident in Portugal can avoid further taxation for up to 10 years.

The scheme is also popular with Europeans looking to minimise taxation on pensions and retirement income by spending most of the year outside higher taxation countries.