Your Property Specialists
Email Address Share
  1. Home
  2. Blog

What changes are proposed for the Non-Habitual Resident status in the 2024 State Budget?

The 2024 State Budget proposes significant changes to the Non-Habitual Resident (RNH) status, with discussions currently underway in Parliament. One of the critical aspects of this proposal is the full termination of the RNH regime; however, current holders will maintain their benefits until the end of their ten-year period. This presents a unique situation for potential new residents to consider. To benefit from the RNH regime, you must register as a tax resident by December 31, 2023, and ensure compliance with the set criteria, including an absence of residency in the last five years and earning income in designated fields. With tax incentives expanding for new residents entering specific sectors starting in 2024, those looking to relocate to Portugal are encouraged to take action. The proposed budget not only shields existing RNH participants but also introduces new opportunities for tax reductions for incoming residents. Monitoring these discussions closely will be essential for understanding how they impact your potential move. Therefore, if you are considering making Portugal your base and want to lock in the benefits of this regime, act swiftly. Engage with professionals who can guide you through these changes and help you understand the implications for your relocation plans. Reap the benefits of living in Portugal while enjoying these tax incentives! Contact us today to learn more about how you can prepare for these changes.

Tuesday, 28 November 2023 - Fiscal
What changes are proposed for the Non-Habitual Resident status in the 2024 State Budget?
Open Gallery
What changes are proposed for the Non-Habitual Resident status in the 2024 State Budget? The 2024 State Budget proposes significant changes to the Non-Habitual Resident (RNH) status, with discussions currently underway in Parliament. One of the critical aspects of this proposal is the full termination of the RNH regime; however, current holders will maintain their benefits until the end of their ten-year period. This presents a unique situation for potential new residents to consider. To benefit from the RNH regime, you must register as a tax resident by December 31, 2023, and ensure compliance with the set criteria, including an absence of residency in the last five years and earning income in designated fields. With tax incentives expanding for new residents entering specific sectors starting in 2024, those looking to relocate to Portugal are encouraged to take action. The proposed budget not only shields existing RNH participants but also introduces new opportunities for tax reductions for incoming residents. Monitoring these discussions closely will be essential for understanding how they impact your potential move. Therefore, if you are considering making Portugal your base and want to lock in the benefits of this regime, act swiftly. Engage with professionals who can guide you through these changes and help you understand the implications for your relocation plans. Reap the benefits of living in Portugal while enjoying these tax incentives! Contact us today to learn more about how you can prepare for these changes.

Furthermore, anyone who meets the requirements for RNH and registers as a tax resident in Portugal by December 31, 2023, can still request RNH status and enjoy its benefits during the 10-year period. Additionally, POE 2024 proposes a new tax incentive for those who become tax residents from 2024 onwards, but only for the area of scientific research and innovation.

To be able to benefit from this regime, taxpayers must meet the following cumulative conditions:

 a) Have not been a resident in Portugal, for tax purposes, during the last five years;

 b) Has acquired tax residence in Portugal; and 

c) Earn income that falls into one of the following categories: 

  • i) Higher education and scientific research teachers, including scientific employment in entities, structures and networks dedicated to the production, dissemination and transfer of knowledge, integrated into the national scientific and technological system;
  • ii) Qualified jobs within the scope of contractual benefits to productive investment, in accordance with chapter II of the Investment Tax Code;
  •  iii) Research and development jobs for personnel with minimum educational qualifications at level 8 of the National Qualifications Framework (doctorate), the costs of which are eligible for the purposes of tax incentives for research and business development (SIFIDE).

The OE Proposal for 2024 also foresees extending the already existing Return Program, so that it applies to taxpayers who become tax residents in Portugal up to 2026 and who have not been tax residents in our country in the last 5 years. The Program allows a 50% tax exemption on income from employment and self-employment up to 250,000 Euros per year during the first 5 years of residence.

We will continue to closely monitor parliamentary discussions and possible proposed changes to the current text of the OE Proposal for 2024.

 Martínez-Echevarría & Ferreira has a team of competent lawyers and professionals qualified to provide advice in several areas of law. For questions related to tax matters, do not hesitate to contact our department. We are at your disposal through the usual channels and contact platforms.

 

© Martinez Echevarria & Ferreira, Law Firm - Tax Department

contact us   +