What replaced NHR in Portugal?

The IFICI regime (Incentivo Fiscal à Investigação Científica e Inovação) replaced NHR on 1 January 2024. It maintains the 20% flat tax rate on Portuguese-source income for eligible new residents but removed the pension income exemption.

Can I still apply for NHR in 2026?

No. NHR closed to new applicants on 31 December 2023. New residents in 2024 and beyond must apply for IFICI instead.

Who qualifies for IFICI in Portugal?

New Portuguese tax residents working in technology, scientific research, highly qualified professions, arts, or making qualified investment. Must not have been resident in Portugal in the previous 5 years.

What is the IFICI tax rate?

IFICI offers a 20% flat income tax rate on Portuguese-source employment and self-employment income, versus up to 48% under standard Portuguese IRS rates.

How long does IFICI last?

IFICI benefits last for 10 consecutive years from the year of first application.

Can I combine IFICI with running a company in Portugal?

Yes. The 20% rate applies to salary drawn from a Portuguese company. Company profits (IRC) are taxed separately at 16–21%.

IFICI: Portugal's 20% Tax Regime for New Residents (NHR Replacement)

By Hugo Ribeiro, Certified Accountant (OCC) · HVR Business Consulting · Updated: April 2026

The IFICI regime replaced Portugal's NHR in January 2024. Eligible new residents pay a 20% flat tax on Portuguese-source income for 10 years — versus up to 48% under standard Portuguese rates.

Who Qualifies for IFICI?

Technology & IT professionals: software engineers, developers, cybersecurity, AI
Scientific researchers: R&D specialists, university professors
Highly qualified professionals: managers, engineers with university degrees
Artists & cultural workers: internationally recognised
Investors & entrepreneurs: creating qualified employment in Portugal

Key IFICI Benefits

20% flat rate on Portuguese-source employment and self-employment income
Foreign income exemption: dividends, interest, capital gains from abroad (if taxed at source)
10-year duration from the year of first application

How to Apply

IFICI is applied for through the annual IRS tax return — there is no separate form. A certified accountant handles the application, selecting the correct code and submitting documentation.

Book a free IFICI consultation →