IFICI: Portugal's new non-habitual resident regime (NHR 2.0)

What happened to the NHR

Between 2009 and 2023 the Non-Habitual Resident (NHR) status was Portugal's great fiscal calling card: 20% on income from "high value added" activities and, for years, an exemption (later 10%) on foreign pensions. The 2024 State Budget closed it to new registrations, with transitional rules only for people who already met the conditions in 2023¹.

Two important points if you are already here:

• anyone who already holds NHR status loses nothing: the old rules apply until their 10 years are complete;
• anyone who never had it and moves to Portugal now has a new regime to evaluate: the IFICI.

What the IFICI is

The IFICI (tax incentive for scientific research and innovation) is the NHR's successor, created in article 58.º-A of the Portuguese tax-benefits statute (EBF)³. The core mechanics feel familiar:

• a special 20% rate on net employment (category A) and self-employment (category B) income earned in the eligible activity;
• for 10 consecutive years, counted from the year you become resident;
• an exemption for most foreign-source income, except pensions.

The real difference is access: the NHR accepted any profession from a broad "high value added" list; the IFICI requires a link to research, innovation or exports, verified by dedicated bodies².

Who qualifies

Three cumulative conditions¹:

1. become a Portuguese tax resident;
2. not have been resident in any of the previous 5 years;
3. work in an eligible activity.

The eligible activities, detailed in Portaria n.º 352/2024/1², group as follows:

• higher-education teaching and scientific research, including science and technology centres;
• qualified posts under contractual benefits to productive investment;
• highly qualified professions in industrial companies or companies exporting at least half of their turnover;
• posts in entities recognised by AICEP or IAPMEI as relevant to the national economy;
• research and development with SIFIDE-eligible costs;
• jobs in certified startups (Law no. 21/2023).

Excluded, even with the right job: anyone who ever benefited from the NHR, anyone who opted into the returning-resident regime (article 12.º-A of the IRS code) and anyone who already used the IFICI itself, which works once per taxpayer¹.

How income is taxed

On Portuguese work income from the eligible activity, the rate is 20% on the net amount. For category A, net means gross minus the standard deduction: in 2026, the greater of €4,587.09 and your Social Security contributions⁴. The IFICI calculator runs this maths and compares it with the general IRS regime.

On foreign income, the general rule is an IRS exemption in Portugal for categories A, B, E, F and G (work, capital, rents and capital gains). Two big exceptions apply¹:

• foreign pensions pay the normal progressive rates (under the old NHR they were once exempt and later taxed at 10%: this is the most radical change);
• income from Portugal's blacklisted tax havens pays 35%.

How much you save: an example

An engineer hired by an exporting company on a €50,000 gross annual salary: Social Security takes €5,500 and taxable income is €44,500. Under the IFICI, IRS is €8,900 (20%); under the general regime it would be €11,436.23. The saving is €2,536.23 per year, every year, for 10 years. On a €100,000 salary the annual saving reaches €13,532.83.

Mind the other side of the ledger: below roughly €33,000 gross per year, the general regime's progressive rates fall under 20%, and the IFICI brings no advantage on Portuguese income (the general rules then simply apply). Run your own numbers in the IFICI calculator and check the effect on your net salary.

How and when to register

The registration request is due by 15 January of the year after the one in which you became a Portuguese tax resident, filed with the body responsible for your activity: FCT for teaching and research, AICEP or IAPMEI for the recognised posts, the tax authority in the remaining cases, under the portaria². The tax authority communicates the outcome by 31 March¹.

A late filing does not close the door, but it costs dearly: the regime only takes effect from the year the registration is made, and the lost years count against the 10-year benefit¹.

NHR vs IFICI at a glance

If you are planning the move, start with the right question: is my activity on the portaria's lists? Then run the numbers in the IFICI calculator and, for the rest of the household budget, see what is left with the net salary calculator. If you are starting your career in Portugal rather than moving in from abroad, the regime to study is IRS Jovem.