📢 Breaking News: The End of NHR Approved. What to Expect from 2024

The Portuguese Parliament today, November 29, 2023, approved the State Budget Law for 2024, which brings a seismic fiscal change: the popular Non-Habitual Resident (NHR) tax regime has been formally closed to new entrants.

The NHR, which for over a decade offered significant tax benefits to new residents, will be revoked starting January 1, 2024. This means that from the new year onward, no new applications for the NHR status will be accepted.

• What This Means for You:
  • New Arrivals (starting 2024): Will not be able to obtain the 10-year NHR tax exemption and will be subject to Portugal’s standard progressive tax rates (up to ~48%).
  • Transition: The law includes crucial transitional provisions. If you have already been granted NHR status, you will keep your benefits for the full 10-year period.
  • Window of Opportunity: Individuals who met specific conditions by December 31, 2023 (such as having a signed employment contract, lease agreement, or a pending residence application) may still be able to apply in early 2024 under the old rules.

The end of the NHR is a significant shift in Portugal’s tax policy toward expatriates. Tax planners and lawyers are now urgently reviewing client situations to utilize the transition window.