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NHR Tax Regime for Canadians in Portugal

Disclaimer: I am not a tax expert. Please talk to professional tax advisors in Canada and Portugal to talk through your unique situations

Oct 2023 Update: The Portuguese Government has decided to make big changes to the NHR program. Please see here for more details. Therefore, the below may not be available anymore.

Jan 2024 Update: The Portuguese Government has landed on a new, more strict NHR programme known as NHR: The Scientific Research and Innovation Scheme.

Below is only relevant if you received NHR status before Dec 2023

As a new resident of Portugal, I was able to apply for the Non-Habitual Tax Regime (NHR) that is available here. Read about my move from Canada here: The Comprehensive Guide to the Digital Nomad Visa

What is the Non-Habitual Tax Regime (NHR)

The Non-Habitual Tax Regime is a tax program created in 2009 to attract foreign-qualified professionals, retirees, and students who have stable income. To be able to apply for the NHR, you need to meet the following criteria:

  • be at least 18 years old
  • be a resident of Portugal
  • have not been a tax resident in Portugal for the last 5 years
  • have a Portuguese NIF number

Difference between Visas & Taxes

Individuals commonly confuse visas and taxes. Visas allow you to stay in a country for a certain period of time (short or long). Tax residency is based on how many days per calendar year you spend in a county. For digital nomads, this concept gets increasingly difficult if you move around a lot. Now that I spend over 183 days in Portugal, I am a tax resident in Portugal.

Canada and Portugal Tax Treaty

Signed on June 14, 1999, Canada and Portugal signed the “Convention Between the Government of Canada and the Government of the Portuguese Republic for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income” (long enough title!).

It’s a lengthy document, but in a nutshell, it outlines how tax categories are managed between both countries. Read more here.

Applying for NHR

Once you have formalized your residency and have your Portuguese NIF, it’s very straightforward to apply for NHR. You do not need a lawyer to apply for NHR status. I used the paper that SEF provided me to confirm my residency (as I am still waiting on my permanent resident card) and logged into the Portugal Tax Portal.

Once you are able to log in, I followed this step-by-step guide from Bordr: https://bordr.com/guides/how-to-apply-for-portugals-nhr-tax-regime-on-portal-das-financas

I followed the step-by-step and I was granted NHR in 3 business days!

What Professional Firms I Worked With To Figure Out My Tax Situation

I joined the Facebook group Tax benefits for expats in Portugal, which was created and maintained by Zeev Fisher, the owner of Fresh Tax Portugal. The lawyers and accountants at Fresh have experience working with immigrants from the UK, the US, and slowly Canada, so they are knowledgeable about how to create your personal tax strategy. I used Fresh to file my taxes for the 2022 year and it was a seamless experience.

I worked with a few members of the Fresh team and I found them to be highly responsive, informative, and professional. I will continue to work with them each year for my taxes here in Portugal.

Overall, taxes are complex and important to get right! I’d recommend doing your research but also consulting with professionals in both Canada and Portugal to maximize your tax situation and ensure you are not double-taxed.

Other Helpful Resources for Non Habitual Tax Regime (NHR):

aperkins

2 thoughts on “NHR Tax Regime for Canadians in Portugal

  1. Hi Amanda, Planning to move from Québec to Porto next summer. Glad to hear you used the Fresh crew, I was going to use them as they seem to know what they’re doing, but am glad to know that someone else used them to advantage. How about health insurance and driver’s licence, how did that work out for you? Lots of contradictory info out there. Thanks, Émile

    1. Hi – for health insurance, check out my other article on SafetyWing – they were awesome to work with for the first bit and then I eventually switched to Allianz. And I have kept my Canadian drivers license for now. I’ve also read contradictory information so I’ve left it for now because I dont drive that much.

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