RNH Portugal Status | What benefits | For whom | How to get it?

In response to the severe economic crisis that the country had been facing since 2008, the Portuguese government introduced a specific tax regime in 2009 to attract new foreign capital.

The Portuguese RNH Status was created and quickly became a great success among foreign investors. Individuals also benefited from these favourable tax conditions, especially retired people.

RNH PORTUGAL STATUS | WHAT IS IT CONCRETELY ABOUT?

Individuals wishing to settle in the country and become residents of Portugal benefit from substantial tax advantages granted by the government.

The taxes thus collected by the Portuguese authorities, if they are from foreign sources, as in the case of pensioners’ pensions, are not subject to double taxation. Taxation is abolished in the country of the source of income, thanks to the double taxation agreement signed with European Union (EU) and EEA countries.

RNH status is obtained for a non-renewable period of 10 years.

RNH PORTUGAL STATUS | WHAT ARE THE FINANCIAL ADVANTAGES?

The tax rate in Portugal is between 30% and 48%, depending on your level of income. The RNH status offers significant tax reductions. It applies globally in 3 cases:

1) Retired people

EU or EEA pensioners who come to Portugal from the EU or EEA can benefit from a single tax rate of 10% on their retirement pension.

2) Persons in employment

If you are an employee in a high value-added position, the tax rate applied to your income will be 20%.

A list of occupations belonging to high value-added professions has been drawn up by the government:

List of high added value activities within the meaning of point 6 of art. 72 and point 5 of art. 81 of the CIRS:

1 – Architects, engineers and similar technicians:

101 – Architects;

102 – Engineers;

103 – Geologists.

2 – Visual artists, actors and musicians:

201 – Artists of theatre, classical dance, cinema, radio and television;

202 – Singers;

203 – Sculptors;

204 – Musicians;

205 – Painters;

3 – Auditors:

301 – Auditors;

302 – Tax consultants.

4 – Doctors and dentists:

401 – Dentists;

402 – Annalist doctors;

403 – Surgeons;

404 – Doctors on board ships

405 – General practitioners;

406 – Dentists;

407 – Stomatologists;

408 – Physiotherapy doctors;

409 – Gastroenterologists;

410 – Ophthalmologists;

411 – Orthopaedic physicians;

412 – Otorhinolaryngologist physicians;

413 – Paediatric physicians;

414 – Radiological physicians;

415 – Physicians in other specialties.

5 – Professors:

501 – University professors

6 – Psychologists:

601 – Psychologists

7 – Self-employed, technical and similar workers:

701 – Archaeologists;

702 – Biologists and specialists in life sciences;

703 – Computer programmers;

704 – Consultants in computer programming and activities in the same field with Information Technology and Computer Science;

705 – Computer programming activities;

706 – Computer consulting activities;

707- Computer equipment management and exploration;

708 – Information service activities;

709 – Data programming activities, information domiciliation activities and activities in the same field with the web and Internet sites;

710 – Data programming activities, information domiciliation and related activities;

711 – Other information service activities;

712 – Information agency activities;

713 – Other information service activities;

714 – Scientific investigation and development activities;

715 – Investigation and development activities in the physical and natural sciences;

716 – Biotechnology investigation and development activities;

717 – Designers.

8 – Investigators, administrators and managers:

801 – Researchers, administrators and managers of companies that generate productive investment when this is related to eligible projects and contracts for the concession of tax benefits in application of the Investment Tax Code, approved by Law Decree 249/2009, of 23 September:

802 – Company executives.

3) Investment earnings

Investment gains such as dividends and participations are tax-exempt for holders of RNH status.

RNH PORTUGAL STATUS | WHAT ARE THE REQUIREMENTS FOR OBTAINING IT?

Several conditions must be met to obtain the RNH status:

1) Not to have been a Portuguese tax resident during one of the 5 years preceding the application. In other words, you must not have paid taxes in Portugal during the last 5 years.

2) Prove that your main place of residence is Portugal, proving that you have stayed there for at least 183 days a year, continuously or discontinuously. It will also be necessary to demonstrate that your former country of residence is no longer the centre of your vital interests.

3) Have a residence on Portuguese territory, either rented or owned

RNH PORTUGAL STATUS | WHY IS IT NOT GRANTED?

The RNH status is not granted to the applicant if :

1) he or she does not fulfil the above-mentioned conditions

2) if his foreign source of income is derived from an activity in the civil service. Foreign civil servants living in Portugal continue to pay taxes in the country where they receive their pension.

RNH PORTUGAL STATUS : WHAT STEPS SHOULD BE TAKEN TO OBTAIN IT?

If you meet all the necessary conditions, you can apply for RNH status directly to the Public Finance Department in your place of residence.

But before you do so, you will need to :

1) Obtain a Tax Identification Number (NIF) as a non-resident

2) Living in Portugal as a tenant or owner

3) Register with the municipality where you live.

4) Send a written request to the Public Finance Department of your place of residence 

The file to be submitted must also contain the following documents:

1) Your passport or a valid identity card

2) Your Tax Identification Number (NIF) as a non-resident

3) Your European register certificate

4) Residential or property title in Portugal

5) Your tax returns for the last 5 years

6) A certificate on your honour that you have not paid any tax in Portugal for the last 5 years.

7) A written certificate stating that you live more than 183 days a year in Portugal.

RNH PORTUGAL STATUS | HOW TO BACKDATE ITS REGISTRATION?

You can backdate your registration as a non habitual resident in Portugal. To do so, you must register before March 31st of the tax year. In addition, you must have become a tax resident in Portugal.

Once these conditions have been met, it will be possible to have your tax return for the year in which you became a tax resident and thus already benefit from the tax conditions linked to the RNH status.

PORTUGAL TAXES | WHAT OTHER TAXES WILL YOU BE SUBJECT TO?

As a non-habitual resident in Portugal, this does not mean that you are exempt from paying taxes there. The benefits of your status only apply to your income.

You may be subject to other types of tax depending on your activities in the country.

If you would like to find out about the 12 main taxes in force in Portugal, we invite you to read our file: Taxes Portugal | The 12 main taxes | How to calculate them | How to limit your tax charge?

Thank you for taking the time to read our article through to the end.

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