Government Extends Transitional Regime for Non-Habitual Residents
Proposal for changes to the State Budget presented by the Socialist Government gives people who register as tax residents in 2024 the possibility of still benefiting from the tax regime for non-habitual residents, as long as they prove that they have prepared their move during 2023.
Taxpayers who become residents for tax purposes by December 31, 2024 will also be able to benefit from the Non-Habitual Residents (RNH) regime, which the State Budget proposal for 2024 put an end to. To do this, they will have to demonstrate that they were already preparing to arrive in 2023, showing, in particular, an employment contract; rental contract; promissory contract for the purchase and sale of a property; or the school registration of their children in Portugal.
This possibility results from an amendment to the State Budget (OE - Orçamento de Estado) proposal for 2024 presented this week in Parliament by the Socialist Government. In practice, the transitional regime is extended, which the Government had initially foreseen, but which only applied to those who, by December 31st, were already registered with the AT as an NHR or met the conditions to qualify as such.
The Socialist Government’s proposal makes life easier, particularly for those who were already preparing to move to Portugal, - already had a home, job or school for their children, for example - counting on the most favorable tax regime, but which is dependent on the deadlines for waiting for the Foreigners and Borders Service (SEF), which is now the current Agency for Integration, Migration and Asylum (AIMA - Agência para a Integração e Migrações e Asilo).
"In view of the repeal of the NHR tax regime, it is important to create a transitional regime that allows the legitimate expectations of people who have already made the decision to immigrate or return to Portugal to be safeguarded, under penalty of damaging the confidence of those who took that same decision, naturally having to change their country a very material impact on anyone's life", reads the justification note that accompanies the proposal submitted by the socialist deputies.
And how should potential beneficiaries of the NHR tax scheme prove their situation???… According to the PS proposal, they must have one of the following elements:
❖ Promise or employment contract, promise or secondment agreement signed by December 31, 2023, whose duties must take place within national territory;
❖ Lease contract or other contract granting the use or possession of property in Portuguese territory concluded until October 10, 2023;
Reservation contract or promissory contract for the acquisition of real rights over property in Portuguese territory concluded by October 10, 2023;
❖ Enrollment or registration for dependents, at an educational establishment domiciled in Portuguese territory, completed by October 10, 2023;
❖ Residence visa or residence permit valid until December 31, 2023;
❖ Procedure, initiated by December 31, 2023, for granting a residence visa or residence permit, with the competent authorities, namely through the request for scheduling or actual scheduling for submission of the request for granting the residence visa or residence permit or, even, by submitting the application for the granting of a residence visa or residence permit.
It should also be noted that these new rules for access to the NHR regime will apply not only to the individual, but also to the "taxable person who is a member of the household".
And finally, registration as an NHR is expected to be requested electronically, through the Finance Website, after registration as a resident in Portuguese territory.
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