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Tax benefits for private individuals

"Former residents" Programme

A temporary tax regime applicable to ex-residents (both Portuguese and foreign citizens who have already lived in Portugal) who wish to return to the country and acquire a resident status. If they meet certain requirements under the terms of provisions 1 and 2 of Article 16 of the Personal Income Tax (IRS) Code, said individuals will pay IRS on only 50% of income from employment and self-employment.

This regime is applicable in the year in which the candidate becomes resident in Portugal and in the following four years


To benefit from this regime, an individual must:
  • Return to Portugal in the years 2019, 2020, 2021, 2022 or 2023;
  • Have been resident in Portuguese territory before the 31st of December 2015, in the case of taxpayers who become resident in 2019 or 2020, or before the 31st of December 2017/2018/2019, in the case of taxpayers who become resident in 2021, 2022 or 2023, respectively.
  • Not have resided in Portugal during the previous three years;
  • Have a regularized tax situation;
  • Not have applied for registration as a Non-Habitual Resident (RNH).

How to obtain

This benefit is automatic, which means that it doesn’t depend on prior recognition. Its application results directly from the law as soon as the taxpayers become residents in 2019, 2020, 2021, 2022 or 2023 and the other legal requirements are met. However, when filing the IRS return (form no. 3), taxpayers must mention in annexes A, B, or C that they intend to benefit from this regime.

In regards to employment income, taxpayers should invoke their status as former residents returned to Portuguese territory and thus show that they’re covered by the regime in question, for which purpose they should submit a declaration to the income debtor, so that the entity is entitled to withhold IRS on only 50% of the income.

Regarding self-employment income, taxpayers should invoke the above-mentioned status by adding the words "Withholding on 50%, under the terms of article 12 -A of the IRS Code" to the discharge receipt.