Portugal IFICI 2026 — the “NHR 2.0” for New Residents
Portugal closed its famous Non-Habitual Resident (NHR) regime to new applicants at the end of 2023. Its successor, IFICI, keeps the headline 20% flat tax — but narrows who qualifies and changes how foreign income is treated. Here is what new residents need to know.
What IFICI is
IFICI — Incentivo Fiscal à Investigação Científica e Inovação — is Portugal’s tax incentive for people who become Portuguese tax residents and were not resident in Portugal in the previous five years.
Qualifying Portuguese-source employment and self-employment income is taxed at a flat 20% rate, instead of the standard progressive rates that climb to a 48% top bracket.
The benefit runs for 10 consecutive years, as long as you keep meeting the conditions each year.
IFICI vs the standard regime — the headline numbers
These figures come from WizeTax’s verified dataset for Portugal:
| Item | IFICI |
|---|---|
| Flat rate on qualifying professional income | 20% |
| Standard top progressive rate (for comparison) | 48% |
| Duration | 10 years |
| Eligibility | New resident, not Portuguese-resident in the prior 5 years |
| Status | Replaced NHR (closed to new applicants end-2023) |
Source: WizeTax verified dataset (Portugal) · PwC Worldwide Tax Summaries · Autoridade Tributária (Portal das Finanças)
Who actually qualifies
Unlike the old NHR — which almost anyone moving to Portugal could claim — IFICI ties eligibility to your activity. It targets highly qualified roles in scientific research and innovation, technology, and other listed categories.
You must become a Portuguese tax resident and not have been tax-resident in Portugal in the previous five years.
You generally must not have benefited from NHR before. Existing NHR holders keep their status under the old rules (grandfathered).
How foreign income is treated
IFICI generally exempts or relieves several categories of foreign-source income — dividends, interest, capital gains, rents and certain employment income — subject to conditions and Portugal’s tax-treaty network (79 treaties).
A key change from NHR: foreign pensions do NOT get the same broad exemption the old regime offered. Retirees relying on pension income should model this carefully.
The 20% flat rate itself applies to qualifying Portuguese-source professional income, not to your worldwide income automatically.
How to claim it
- Become a Portuguese tax resident (the 183-day test, or a permanent home in Portugal, are the usual routes).
- Confirm your role falls within a qualifying IFICI activity category.
- File the IFICI application with the Portuguese tax authority (AT), generally by 15 January of the year after you become resident.
See your real take-home in Portugal
Compare what you would actually keep under IFICI vs your current country.
Open the Relocation Analyzer →Frequently asked questions
What is Portugal’s IFICI regime?
IFICI is the tax incentive that replaced NHR from 2024. Eligible Portuguese-source professional income is taxed at a flat 20% for up to 10 years instead of progressive rates up to 48%.
Who qualifies for IFICI?
New Portuguese tax residents who were not resident in the previous five years and whose activity falls in qualifying categories — chiefly scientific research, innovation and technology roles.
How is foreign income treated?
Several categories of foreign income may be exempt or relieved, subject to conditions and treaties. Foreign pensions do not get the broad exemption NHR offered.
How long does IFICI last?
10 consecutive years from the year you become a Portuguese tax resident, while conditions are met.
Is IFICI the same as the old NHR?
No. It keeps the 20% flat rate but narrows eligibility to high-value activities and changes foreign-income and pension treatment. NHR holders keep their status.