Professional income qualifying for the reduced NHR tax rate includes high-value-added activities and consulting services internationally.
Under Portugal's Non-Habitual Resident (NHR) regime, certain types of professional income qualify for a reduced tax rate. Here’s a detailed overview:
1. High-Value Professions
- Professional Activities: Income from specific high-value professions is eligible for a reduced tax rate of 20%. This includes professions that are deemed to contribute significantly to the advancement of technology, science, and other specialized fields. The types of professions eligible include, but are not limited to:
- Architects
- Engineers
- Doctors
- Dentists
- Consultants in specialized fields
- Managers and executives of high-profile companies
2. Criteria for High-Value Professions
To qualify for the reduced NHR tax rate on professional income, the activities must meet certain criteria:
- Recognized High-Value Activity: The profession must be recognized as a high-value activity by Portuguese authorities. This typically involves demonstrating that the activity requires significant expertise and has an impact on the Portuguese economy or society.
- Professional Registration: In some cases, professionals must be registered with relevant Portuguese professional bodies or authorities to validate their occupation as a high-value profession.
- Substantial Expertise: The individual must possess significant expertise and qualifications in the field, which may be assessed based on their educational background, work experience, and contributions to the profession.
3. Application Process
- Documentation: Professionals seeking the reduced NHR tax rate must provide documentation proving their professional qualifications and the nature of their activities. This may include diplomas, certifications, and proof of work in their specialized field.
- NHR Application: When applying for NHR status, individuals should specify their professional activities and provide evidence that they fall under the high-value profession category. This will help in determining eligibility for the reduced tax rate.
4. Exclusions
- General Employment: Not all types of employment or professional activities qualify for the reduced rate. For instance, general administrative or non-specialized work does not typically qualify for the 20% rate under the NHR regime.
Summary
Professional income qualifies for the reduced NHR tax rate of 20% if it is derived from recognized high-value professions, which include specialized fields such as architecture, engineering, medicine, and consulting. The activities must meet specific criteria set by Portuguese authorities, and professionals must provide relevant documentation to prove their eligibility.