also called NHR · NHR regime
A Portuguese tax regime that has offered new residents favourable treatment of certain income for a limited number of years.
This is a special Portuguese tax deal that gave people who moved there a lighter touch on certain income for a set stretch of years. The catch is that it has been rewritten more than once, so the generous version someone told you about may already be closed to new arrivals. It is not the same as the British non-dom idea, even though both are ways foreigners end up paying less.
You read an old blog post raving about years of tax-free foreign income under this scheme and move to the Algarve expecting the same. When you file, you find the terms changed before you arrived, and the deal you planned around is not the one on offer to you.
It drew many nomads to Portugal, but its terms have changed over time, so the version you read about may no longer apply.
The difference is the whole point, so here is each one in a line.
These are the favourable schemes some countries offer people who move in.
Non-dom status treats a resident whose permanent home is elsewhere kindly on foreign income, Portugal's Non-Habitual Resident and Spain's Beckham Law are time-limited versions of that idea, and lump-sum taxation in Switzerland and Italy lets certain wealthy residents pay a fixed annual amount instead of tax on actual worldwide income.
A flat tax is the broader idea of one fixed rate regardless of how much you earn.
LOOSELY DEFINED. This term is used widely but not consistently, and its precise meaning shifts by country and by who is speaking. Treat it as a lead, not a rule.
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