The tax benefits to non-habitual residents (RNH) will be made automatically at the time of their registry with the Tax Authority (“TA”). Its main goal is to avoid delays in recognizing this status to candidates.
This way, the taxpayer is now subject to a rate of 20% IRS (income tax) from the moment they register and during the 10 years to which he is entitled to take advantage of this tax regime.
The TA therefore abandons the practice that has been followed in recent years of making prior recognition of the activity simultaneously with the application for registration of a person as a non-habitual resident.
But the fact that this prior recognition of the activity is not made, does not prevent the taxpayer from having to prepare prove of exercising the activity and of obtaining an income.
"The taxpayer shall have prepared proof of the effective exercise of this activity(s) and the corresponding obtaining of income, as well as the other legal assumptions of the right it relies on in any of the years, to the maximum period of ten years in which you can enjoy the status of NPR, and make its presentation whenever requested by the TA services", states the guiding document, signed by the General Director of the Portuguese TA.
The document adds that, this way, "the verification of the facts/assumptions of the law relied in the declaration takes place through evidence to be submitted by taxpayers at the stage after the surrender of the income statement, and not by the endorsement code in the application of the register (SGRC), as has occurred so far".
According to the IRS code, this supporting evidence must be submitted within 15 days and it may be extended to 25 days when the taxpayer invokes difficulty in obtaining the required documentation.
This change in procedures is due to the fact that the prior recognition, that the TA had carried out at the same time, as an application for registration as a non-habitual resident proves to be "excessively time consuming". Also, it does not eliminate the need for further control of the maintenance of the verification of the assumptions entitled to the RNH tax regime.