Portugal Announces New NHR 2.0 Tax Regime for 2025

Portugal’s Economy Minister Pedro Reis has confirmed that the new IFICI+ tax framework, referred to as NHR 2.0, is undergoing final regulations and will be officially launched within days. Speaking during a parliamentary session on the 2025 State Budget, Reis stated that they are "hours away from having the instrument out there, as promised."

NHR 2.0 vs. Current NHR Program

The updated program introduces several significant changes to previous NHR regime while retaining some key benefits:

• Pension income no longer qualifies for tax benefits.
• Expanded list of eligible professions, with criteria pending regulation.
• Continued 20% flat tax rate for employment and freelance income.
• Maintained tax exemptions for foreign-sourced capital gains, dividends, interest, and rental income.
• Simplified professional qualification criteria, removing the “high-value-added” requirement.

Registration Deadlines for NHR 2.0

Eligible individuals must register by March 15, 2025, to apply the retroactive 20% income tax rate for 2024 income. For future years, the registration period will begin on January 15.

"This is to give people time to familiarize themselves with the instrument," said Reis. While promising broader coverage of professions and companies, final eligibility criteria for the new NHR tax program in Portugal remain undisclosed pending the publication of regulations.

Who Qualifies for Portugal’s Updated Tax Regime

Similar to the original NHR program, the 2.0 version targets individuals who have not been Portuguese tax residents for the past five years. The program continues to offer benefits for a 10-year period but now focuses on attracting active professionals and investors rather than retirees.

Although the program is technically active since January 1, 2024, the main implementation is contingent on final regulation, which will determine how applicants can apply the reduced tax rate to their 2024 income during 2025 tax filings.