Coming to the End of NHR in Portugal? Your Practical Checklist

Coming to the End of NHR in Portugal? Your Practical Checklist

If you have benefited from Portugal's Non-Habitual Resident (NHR) tax regime, the end of your NHR period is an important financial milestone.

As explained in our Vendici Guide to Portugal's NHR 2026, NHR benefits are available for a limited period. When that period comes to an end, individuals who remain tax resident in Portugal will generally move onto Portugal's standard tax regime.

The change does not necessarily mean that you need to alter your finances or your plans to live in Portugal. However, it does mean that planning ahead is important.

Everyone's circumstances are different. Your post-NHR position will depend on factors such as your income, pensions, investments, property ownership and the countries in which your income arises.

For that reason, Vendici strongly recommends discussing your individual circumstances with an appropriately qualified Portuguese lawyer, accountant, tax adviser or fiscal representative before your NHR status expires.

Here is a practical checklist to help you prepare for that conversation.

12 Months Before Your NHR Ends

Confirm Your NHR Expiry Date

Start by confirming exactly when your NHR entitlement ends.

Do not rely solely on when you remember moving to Portugal. Check your individual position through the Portuguese Tax Authority (Autoridade Tributária), your Portal das Finanças account or with your professional adviser.

Arrange a Tax Review

This is a good time to ask your Portuguese tax adviser, accountant, lawyer or fiscal representative to review what your finances could look like after NHR.

Ask for an estimate comparing:

Your current tax position under NHR with Your likely position under Portugal's standard tax regime.

This should give you an early indication of whether your overall tax liability is likely to change.

Make a Complete List of Your Income

Include income received both in Portugal and overseas, such as:

• State pensions
• Private and workplace pensions
• Government or public-sector pensions
• Employment or self-employment income
• Rental income
• Bank and savings interest
• Dividends
• Investment income
• Capital gains

This provides your adviser with a complete picture rather than considering individual sources of income in isolation.

6–12 Months Before NHR Ends

Review Your Pensions

Pensions deserve particular attention.

Different types of pension can be treated differently for tax purposes. For example, certain government or public-sector pensions may be treated differently from private or workplace pensions under the relevant double-taxation agreement.

If you receive pensions from the UK or another country, ask your adviser to establish how each pension will be treated after NHR ends.

Review Investments and Savings

Consider all investments held in Portugal and overseas, including:

• Shares
• Bonds
• Investment funds
• Investment portfolios
• Bank deposits
• ISAs or similar overseas savings arrangements
• Offshore investments
• Dividend-producing investments

A savings or investment product that receives favourable tax treatment in another country may not receive the same treatment in Portugal.

Do not sell, transfer or restructure investments purely for tax reasons without obtaining appropriate professional advice.

Review Overseas Property

If you own property outside Portugal, review the potential tax implications of:

• Rental income
• Selling the property
• Capital gains
• Property ownership structures

If you are Portuguese tax resident, overseas income may still need to be declared in Portugal even where tax has already been paid in another country.

3–6 Months Before NHR Ends

Check Your Overseas Accounts

Make sure your adviser has details of relevant overseas bank and financial accounts.

Portuguese tax residents may have reporting obligations relating to foreign income and overseas accounts through their Portuguese tax return.

Foreign income is generally reported through Annex J (Anexo J) of the Portuguese Modelo 3 tax return.

Check the Relevant Double-Taxation Agreement

Portugal has double-taxation agreements with many countries, including the United Kingdom.

These agreements can determine which country has the right to tax particular types of income and how relief is provided where tax has been paid overseas.

This can be particularly important for:

• Pensions
• Rental income
• Investment income
• Dividends
• Interest
• Capital gains

Do not assume that because income has been taxed overseas it does not need to be declared in Portugal.

Consider Capital Gains Before Taking Action

If you are considering selling property, investments or other significant assets, discuss the timing with your professional adviser.

The tax consequences of a disposal can depend upon your circumstances and tax status at the time of the transaction.

When Your NHR Period Ends

Understand What Changes

NHR is a tax regime. The end of NHR does not, in itself, mean that you must leave Portugal or that your right to live in Portugal ends.

If you continue to be tax resident in Portugal, your income will generally become subject to Portugal's standard tax rules, subject to applicable exemptions, deductions, double-taxation agreements and your individual circumstances.

Review Your Tax Residency

If Portugal remains your main home, you may continue to be Portuguese tax resident.

However, if you divide your time between Portugal and another country, or your circumstances have changed, you should obtain professional advice about where you are considered tax resident.

Tax residency can have significant consequences and should not be determined simply by where you own a property.

Your First Year After NHR

Prepare for Your Portuguese Tax Return

Make sure you retain documentation relating to:

• Pension income
• Employment income
• Investment income
• Dividends and interest
• Rental income
• Capital gains
• Overseas tax paid
• Bank and investment accounts
• Property transactions

Your accountant or fiscal representative may need this information when preparing your Portuguese tax return.

Review the Actual Outcome

Once you have completed your first tax year outside NHR, compare the actual outcome with the projections prepared before NHR ended.

This is also a sensible time to review your financial arrangements for future years.

Don't Forget Estate and Succession Planning

The end of NHR can also provide a useful opportunity to review your wider affairs, particularly if you own assets in more than one country.

Consider discussing the following with an appropriate professional adviser:

• Portuguese and overseas wills
• Property ownership
• Beneficiaries
• Inheritance and succession planning
• Powers of attorney
• Life assurance
• Pension nominations

Cross-border estate planning can be complex, so specialist legal advice is particularly important.

Your NHR Expiry Checklist

When an individual's NHR entitlement ends, they will generally become subject to Portugal's standard tax rules if they remain Portuguese tax resident. The effect will depend on their individual income, pensions, investments and other circumstances, so professional tax or legal advice should be obtained before the NHR period expires.

12 months before

☐ Confirm your exact NHR expiry date
☐ Arrange a professional tax review
☐ Estimate your likely post-NHR tax liability
☐ List all Portuguese and overseas income

6–12 months before

☐ Review each pension separately
☐ Review investments and savings
☐ Review overseas property and rental income
☐ Discuss any planned asset disposals

3–6 months before

☐ Identify overseas bank and investment accounts
☐ Check the relevant double-taxation agreement
☐ Gather records of overseas tax paid
☐ Review potential capital gains

When NHR ends

☐ Confirm your ongoing Portuguese tax position
☐ Review your tax residency if your circumstances have changed
☐ Check whether any tax payments or arrangements need adjusting

First year after NHR

☐ Prepare documentation for your Portuguese tax return
☐ Ensure relevant overseas income and accounts are reported
☐ Compare your actual tax position with your earlier forecast
☐ Review your arrangements for future years

Planning Ahead

The key message for anyone approaching the end of NHR is simple:

Don't wait until NHR has already expired to find out what it means for you.

Starting the process approximately 12 months beforehand gives you time to establish your likely position, gather the necessary information and obtain professional advice before making significant financial decisions.

For many international residents, the end of NHR is simply a transition from one Portuguese tax regime to another. The financial impact, however, can vary considerably from one individual or household to another.

Living or Owning Property in the Algarve?

At Vendici Properties, we work with international clients buying, selling and living in Portugal's Algarve.

Our role is property — not tax or legal advice — but we understand that buying and owning a home in Portugal involves much more than choosing the right property.

Our website guides are designed to provide practical information to help international buyers and residents understand some of the issues they may need to consider when living in Portugal.

Read our main Vendici Guide to the Portugal NHR 2026 Tax regime for further information about NHR and how the regime works.

Where specialist advice is required, clients should consult an appropriately qualified Portuguese lawyer, accountant, tax adviser or fiscal representative.

Vendici can provide contact details of local lawyers, accountants or fiscal representatives if you need any assistance.

Important Disclaimer

The information contained in this article is intended as a general guide only and does not constitute tax, legal, financial, investment or residency advice.

Tax circumstances vary considerably between individuals. The treatment of pensions, investments, property, capital gains and overseas income will depend upon an individual's personal circumstances, tax residency, source of income and any applicable double-taxation agreement.

Portuguese tax legislation and international tax arrangements can also change.

Before making any financial, investment, property or tax-related decision, you should obtain advice specific to your circumstances from an appropriately qualified Portuguese lawyer, accountant, tax adviser or fiscal representative.

Vendici Properties Lda. is a real estate agency and does not provide individual tax, legal, financial or investment advice.