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30th November, 2023
In October, Portugal signalled its intention to end the attractive ‘Non-Habitual Resident' (NHR) regime that many Irish people have availed of since its introduction in 2009. The regime allows qualifying individuals to avail of reduced Portuguese tax rates on income and gains for up to a 10-year period – with a 10% income tax rate on pensions and a zero Portuguese tax rate on certain foreign incomes.
Plans to end the regime were thrown into doubt with the resignation of Antonio Costa, Portuguese Prime Minister, soon after the announcement. However, on 28th of November, lawmakers passed the Portuguese State Budget for 2024, confirming that the NHR regime would end after a transitionary period. Those already availing of the reduced tax rate for a 10-year period will be able to continue to do so. Individuals able to provide evidence that they were already planning a move to Portugal in 2023 may still be able to benefit from the NHR regime in 2024.
Considered planning and advice is required for anyone contemplating non-Irish residency. At Davy, we work closely with clients and their tax and legal advisers to ensure that structures such as pensions and investments are optimally positioned as part of their residency planning. Financial planning is a core component of our client offering. Our approach spans the entire wealth management spectrum including pensions, tax, structuring, succession, philanthropy, protection and investments. Why not request a call today?
WARNING: Tax information provided/discussed in this Insight is provided for Irish Resident investors only by way of general guidance only and is neither exhaustive nor definitive and is subject to change without notice, including potentially retrospectively. It is based on Davy’s understanding of Portuguese Tax legislation as at 29th November 2023. It is not a substitute for professional tax advice. Please note that Davy does not provide tax advice. You should consult your own tax advisor about the rules that apply in your individual circumstances.
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