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Can you live in Portugal and pay no TAX? (Non habitual residency program explained)

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Portugal is one of these countries that is extremely interesting to digital nomads and entrepreneurs. Many of our clients moved there, and many more are considering moving there in the future. Why wouldn’t they? Portugal is a beautiful country with great weather and food.
But the question arises – Can you live in Portugal and pay no tax?

Have you heard of the Portuguese non-habitual residency program? Today we are going to discuss how exactly the NHR program (that was created in 2009.) works. This program lasts for 10 years, which means that you can take advantage of tax cuts for 10 years, after which you’d be taxed normally.

Can you get zero tax under this program? Well, it’s not so straight forward – but it is possible!
We will try to explain how can this be achieved.

*Mentioned in the video:
Portugal NHR occupation list High Value Added Professions (for 20% tax rate):

Archaeologists
Architects
Auditors
Biologists
Computer programmers
Data processing and hosting specialists
Dentists
Designers
Engineers
Geologists
Medicine doctors
Musicians
News agency and other information professionals
Painters (artistic)
Psychologists
Scientific research and development professionals
Sculptors
Senior management positions, except company directors
Singers
Tax consultants
Theatre, ballet, cinema, radio and TV artistic professionals
University teachers
Web developers and designers
Investors, directors and managers of companies promoting eligible projects under tax incentive contracts
IT consultants
IT professionals
IT specialists (other)
Life sciences specialists

PORTUGAL’S BLACKLIST JURISDICTIONS

• American Samoa• Andorra (*)• Anguilla• Antigua and Barbuda (*) • Antilles
• Arab Republic of Yemen • Aruba• Ascension Island• Bahamas
• Bahrain• Barbados (**)• Belize (*)• Bermuda (*)• Bolivia• British Virgin Islands (*)• Brunei• Cayman Islands (*)• Channel Islands (*)• Christmas Island• Cocos (or Keeling) Islands• Cook Islands• Costa Rica• Djibouti• Dominica (*)• Falkland Islands (or Malvinas) • Fiji Islands
• French Polynesia • Gambia• Gibraltar (*)• Grenada
• Guyana• Honduras• Hong Kong (**)• Island of Guam• Island of Kiribati• Island of Tokelau• Jamaica• Jordan• Kuwait (**)• Labuan• Lebanon• Liberia (*)• Liechtenstein• Maldives Islands• Marshall Islands• Mauritius• Monaco• Montserrat• Nauru• Niue Island• Norfolk Island• Northern Mariana Islands • Oman (**)• Pacific Islands not listed
• Palau Islands • Panama (**)• Pitcairn Island • Puerto Rico
• Qatar (**)• Qeshm Island• Republic of Vanuatu• Saint Helena• Saint Kitts and Nevis (*)• Saint Lucia (*)• Saint Vincent and the Grenadines• San Marino (**)• Seychelles• Solomon Islands• St. Peter’s Island and Miquelon• Svalbard (Spitsbergen archipelago and Bjørnøya island)• Swaziland• Tonga• Trinidad and Tobago• Tristan da Cunha Island• Turks and Caicos (*)• Tuvalu Island• United Arab Emirates(**)

(*) – These jurisdictions may eventually leave this blacklist since they have signed agreements for the exchange of information with Portugal.
(**) – These jurisdictions may eventually leave this blacklist since they have signed double taxation agree- ments with Portugal that are in force.

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We are Offshore Citizen team. We help people become global: get a second passport, set up a second residency, pay less taxes, do banking abroad, etc.

We have lots of interesting articles on different topics, we have relevant information up to date.

Author: Michael Rosmer

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40 COMMENTS

  1. I'm an italian citizen living in the US planning on moving to portugal to live there and not work. My only source of income will be from trading crypto and investments. Will I qualify for no tax residence?

  2. Thank you for the video, good info. If it matters to you, please know you have a tendency to mumble you words a bit, it can be hard to follow at times. Again, thank you for the info.

  3. Hi, interesting video, thanks for sharing it. If you live in EU country (for example Spain) and you trade stocks and crypto. Is it possible to set up a company in Portugal for just capital gains and pay zero tax that this company generated living and trading in other EU country?

  4. so in which cases, you can have a zero or very low overall tax with dividend income? any jurisdiction examples you can give? Also I heard self-employment income outside portugal will not be taxed in portugal at all, so if the country where you are registered as a sole trader charges very low tax, that will be your final tax, is this right? One could pay from the US LLC or UK LLP to the sole trader account making it self-employment income – and hence doesn't matter how Portugal treats dividends.

  5. If you are a US citizen living abroad and you receive dividends that are effectively taxed below 20%, won't you always have to pay the difference anyway to the I R S when you file your return (20% – % you paid)?

  6. Hey so did I understand it right, that if you want to apply for the NHR Program the income source has to come from another country than Portugal? So if I want to start a Digital Business and build a corporation in Portugal (because you can't just move out if you build one in Germany) I will not be fit for the NHR Program anymore? Digital Products can be sold all across the globe, so where is it exactly where digital nomads get their money from?

    Loved the video 🙂 thank you so much

  7. Excellent video. A treasure trove of info. I noticed that in this video you went all "Jim Cramer" on me 🤣. Had to replay some parts to make out what you said as you talked at 110 mph haha. Keep in mind that not all of your audience consists of native English speakers. Cheers!

  8. Yeah but if I’m on this visa in Portugal, earning rental income from my home country, must I still pay income tax to my native “source” country? e.g. Ireland

  9. I'm a physician considering semi retirement. Thinking about working in the US 3-6 months a year and living the rest of the time in Portugal. Would I be taxed by Portugal for the income I made in the US?

  10. Rondo of the greatest ill plaguing our sucess in the investmemt sector is ignorance and fear of the unknown…if only we can keep the fear aside trust me you will succeed…Gold are good but i must say crypto can transform your life fasster than you think from poor to rich in

  11. If a retiree receives pension from US government and live in Lisbon, that person is currently paying taxes to American federal and state tax, will that person pay Portuguese income tax as well? I hope the person will not have double tax

  12. There are many german youtubers who have moved to Madeira claiming "they just like the island" and they imply that they are not saving much on taxes and that this is not their main reason they moved there. I call that bs but I am not 100%.. could you elaborate on that? Most famous one is Simon Unge.

  13. I will have a substantial pension and want to live in Portugal for 1-2 years. How is it possible for Portugal to tax my pension 10% if I’m already paying Taxes to USA. Is this a violation of the tax treaty. Please explain

  14. I will be fully taxed by the US on both my SS payments AND my online work, so im NOT about to spend time in any other country that is going to try and tax me on that SAME income!……that would just be crazy!!….the fact i would be spending buckets of cash in their country IS my tax!….

  15. Who are your clients? I don't think there is really any way to pay zero tax as an American citizen. GILTI and offshore bank reporting put an end to that. Anyways, the Portugal visas do sound interesting.

  16. Scenario. UK citizen whose sole income is from cryptocurrency investments. Wishes to live in Portugal six months of the year and by doing so would like to negate UK CGT. A) Can a zero tax rate apply in Portugal for such a person and B) Can that person then utilise part of those funds to buy assets (eg property) in the UK at a later time without being liable for CGT in the UK? This on the basis that he/she is classed as a non habitual resident in Portugal. Thanks.

  17. Hi I'm a UK citizen currently on france but back and forward to UK and UK resident but qualifying for French residence this year. Thinking about giving up and going back to UK as it seems the French tax and social charges are ludicrous , whilst the UK isn't much better at least I can have some tax free gains like Isa's and manage a pension tax free. Thinking about Portugal. What you think

  18. Do you have any advice on someone who used to run a sole proprietorship in the UK with mainly UK clients, moves to Portugal and operates in the same manner with the same clients? Is there a way to qualify for the NHR? I need to get the application done my end of month so would appreciate some input. I will book a call with you.

  19. What if im employed in my home country, getting regular salary after taxes, allowed me to work remotely abroad and i would like to stay in portugal. My position is IT-related with income that meets the financial capacity as a temporary resident. But i am an employe and therefore a dependent IT worker. My country does not have a double tax treaty with portugal

  20. I have lived in Portugal for over 4 years now…Almost no one is paying normal Taxes here…The Country is disorganized and corrupt…It's a country that has hid it's real issue's of being Broke, by riding on an Tourism high for the last 5 year's…Golden Visas are for folk's who have money to throw away…Many digital nomads I know have left because of the lockdown restrictions and folk's I know who own businesses here are closing up shop because of the Work ethic…As an Portuguese Engineer told me once you don't move to Portugal to work for Portuguese an company and etc…You move to Portugal with money…On the Positive side…It's Beautiful country, safe and affordable for most…Boa dia from Sunny Portugal!🇵🇹🤘🤟🤙😉

  21. How does the tax work for someone who is 60, retired early, living off their savings until they reach 67 and start receiving their pension. I am assuming they are not taxed until they start receiving their pension, which you said was taxed at 10%. Is this correct? And after 5 years they can apply for Portugese residency. What is the tax on resident pensioners?

  22. I am going to move to Portugal in the next year – virus permitting. The primary reason is because I have sizable unrealized capital gains in crypto and Portugal affords me a 0% tax rate on those gains. However, I would also like to reside there with the purpose of acquiring the citizenship. I have 3 income streams 1) Passive income from crypto lending platforms 2) Dividend income from a US equity portfolio 3) Rental properties in Asia, and Europe (not Portugal). I know these are tax free under NHR but I am still subject to a 15% withholding tax on the dividend income from the US. As an individual, this is automatically collected by my broker. I want to eliminate this withholding tax if possible. Is there a US structure that could be used to obviate this tax and still remain complaint with NHR stipulations for tax free income from overseas? I had thought to use an LLC, but having heard your remarks, i am hesitant. I am not a US citizen or resident and and therefore a non-resident alien for tax purposes. Any advice would be appreciated.

  23. If you are a USA Citizen, you will pay USA tax no matter where you live. If you claim Portugal NHR and you live in Portugal for more than 183 days a year , you are going to pay 10% ( not zero any more) depend on the source of income. US-Portugal Tax treaty may exclude SS from double tax,. Don’t know 401k and IRA income.

  24. the tax benefits with the change aren't all that great.. in the US I can pay 12% up to $53k of income ($41k and standard ded. of 12.5k). Also dividends and cap gains can be zero in the US in the lower income brackets

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