Despite the attractive tax benefits of Portugal's NHR tax regime, the wealthy expats survey revealed that only 27% of existing NHR tax status holders have taken steps to plan for the future when their NHR incentives expire. This means the majority of existing NHR tax holders could face higher taxes if they don’t seek urgent professional advice.

Portugal Pathways tax experts have urged wealthy expats in Portugal with NHR tax status to be proactive and take action, previously stating:

"Many affluent expats are lulled into a sense of complacency by the NHR tax regime's low tax rates. They fail to realise that these benefits are temporary, and that failing to plan early enough for the future could have serious financial consequences.

"Once the NHR tax incentive period expires, a large majority of expats become subject to Portugal's progressive tax system, which can dramatically increase their tax burden to as much as 48%.

Acting early in their NHR tax life enables existing NHR tax holders the opportunity to mitigate future tax burdens by optimising tax-efficient structures and contacting professional advisors now is becoming an urgent matter for many affluent expats in Portugal.

Credits: Supplied Image; Author: Client;

Mitigating serious tax burden through early planning

Proactive planning within the first seven years of your NHR tax status life can significantly reduce future tax burdens for up to two decades.

Restructuring your portfolio to favour tax-efficient investments, such as capital gains-exempt or tax-deferred options, can minimise tax liabilities.

Leveraging Portugal's tax deductions and credits for mortgage interest, medical expenses, and charitable donations can further optimise your financial situation.

Marcel Léger, a retired investment banker and existing NHR tax status holder, had this to say about NHR tax planning. "Failing to plan for the future can have serious financial consequences," he warns. "By taking proactive steps, you can safeguard your income, assets, and wealth for the future and continue enjoying the benefits of living in Portugal for the long term."

Don't Wait Until It's Too Late

By taking early action and seeking expert guidance, you can safeguard your financial future and continue to enjoy the benefits of living in Portugal.

Contact Portugal Pathways expert team for personalised guidance for existing NHR tax holders structuring their income, assets, tax, and investments for the long term.