IFICI Tax Scheme

Portugal's newly introduced Tax Incentive for Scientific Research and Innovation (IFICI) tax scheme has become a significant draw for international talent, often referred to as the NHR 2.0 tax regime. This tax benefit offers substantial advantages to highly qualified professionals, entrepreneurs, innovators, directors of approved start-ups, and academic researchers who become Portuguese taxpayers.

Key features of the IFICI tax scheme (NHR 2.0) include a 20% flat tax rate on professional income derived from the listed activities within the tax regime and 0% tax applicable to non-Portuguese income, including capital gains and dividends (excluding pensions and certain blacklisted sources).

This allows the IFICI regime (NHR 2.0) to attract global talent while boosting Portugal’s economic competitiveness. The capital gains exemptions make it especially appealing for those value creators relocating from higher-tax jurisdictions, aligning with Portugal's economic strategy of attracting entrepreneurs and talent to Portugal.

Portugal has already implemented a 100% tax exemption for young people earning up to €28,000 in the first year of work (dropping to 75% from the second to fourth year, 50% between the fifth and seventh, and 25% from the eighth to tenth year) to continue attracting the right talent from abroad and at home.

Portugal’s Golden Visa Programme

While the Golden Visa residency-by-investment programme has undergone changes disqualifying real estate investments, it continues to be the main pathway for non-EU nationals seeking residency and potential citizenship in Europe.

The most popular route to Golden Visa residency is to invest a minimum of €500,000 in one or more approved alternative investment funds. Many choose to invest in sectors where Portugal is punching above its weight against international markets, such as media and international events, luxury living, renewables, healthcare, and tourism and hospitality.

The benefits of Portugal’s Golden Visa programme include visa-free travel within the Schengen Area, eligibility to apply for Portuguese citizenship and an EU passport after five years and a minimum stay requirement of seven days per year in Portugal.

These advantages make Portugal an attractive option for investors looking to gain a foothold in Europe while maintaining flexibility in their global lifestyle and without having to commit to staying in Portugal for up to six months a year minimum that all the other visa options require, such as D2, D3, D7, and D8.

Paul Sheedy, international advisor to the Portugal Future Fund, an alternative investment fund approved for Golden Visa residency-by-investment in Portugal, said: “We are seeing significant investment coming from around the world already in 2025 who want to take advantage of the strong opportunities and lifestyle that Portugal offers. Especially in markets such as media, technology, healthcare, luxury living, and tourism and hospitality.”

Hub for Startups and Innovation

Portugal has rapidly emerged as one of Europe’s most dynamic startup ecosystems. In 2024, Braga was named the European Commission’s European Rising Innovative City award winner, just a year after Lisbon was named the European Capital of Innovation. This solidifies Portugal’s position as a hub for entrepreneurship and technological advancement.

Ernst & Young’s recent report on Portugal’s competitiveness stated that investor confidence was at an all-time high compared with the Eurozone and the UK.

The startup scene in Lisbon has experienced remarkable growth, with investments in startups growing 30% annually over the last nine years, twice the average of the rest of Europe, according to global research organisation StartupBlink.

Lisbon, amongst the rest of Portugal, has benefitted from increased government support for entrepreneurship, improved access to capital and the establishment of incubators and accelerators. This, alongside high-profile success stories including several unicorns, has boosted Portugal’s reputation in recent years.

Credits: Unsplash; Author: @alexandrecpaulo;

Lisbon is number four in the world’s most popular destination for international media, investment, and tech events, such as the Web Summit, Portugal Investment Owners Club investment forums, and the IFA Global Conference that brings over two thousand of the world's leading advisors in tax and investment to Portugal this year. All of these factors play a crucial role in promoting Portugal globally and attracting international talent, entrepreneurs, and investment.

Paul Stannard, founder and chairman of the Portugal Investment Owners Club and Portugal Pathways, said: “Portugal has created a unique environment for likeminded people to be able to create sustainable investments in key sectors of the country’s economic strength, allowing value creators as well as highly qualified talent to prosper through a combination of tax incentives, quality of life, and investment.”

Quality of Life

Beyond the financial incentives and business opportunities, Portugal's high quality of life remains a significant draw for relocating entrepreneurs, talented people, and professionals. The country offers a Mediterranean climate with abundant sunshine, a rich cultural heritage, a vibrant employment ecosystem, and a relaxed and welcoming lifestyle.

Portugal's commitment to sustainability and innovation also contributes to its appeal. The country has made significant strides in renewable energy adoption and urban development, making it an attractive destination for environmentally conscious individuals and businesses.

Portugal's appeal as a relocation and business start-up destination will continue to progress with these new initiatives and tax incentives. The country's commitment to fostering innovation, attracting international talent, and maintaining its high quality of life positions it as a prime location for those seeking personal and professional growth in an increasingly interconnected world.

About Portugal Pathways

Portugal Pathways has supported hundreds of Golden Visa residency-by-investment applications and provides expert guidance through its professional supply chain network on luxury property, wealth management, and tax optimisation, including post-NHR tax regime planning, as well as private healthcare, IFICI tax incentive applications, money transfers and bespoke relocation solutions to enhance life and investments in Portugal.

About Portugal Future Fund

The Portugal Future Fund strategically invests in key sectors, driving growth and innovation across Portugal. Approved for Portugal’s Golden Visa residency-by-investment, it offers a unique opportunity for impactful and rewarding participation.

Portugal Investment Owners Club

The Portugal Investment Owners Club, or P Club for short, is a unique investor membership community designed for discerning individuals, families, and organisations committed to exploring and capitalising on life in Portugal and enjoying money-can't-buy experiences and exclusive events.