Portugal’s new Incentive for Scientific Research and Innovation (IFICI) has quickly become one of the most relevant tax regimes for expatriates and highly qualified professionals relocating to the country. Introduced through Article 58-A of the Estatuto dos Benefícios Fiscais (EBF) and fully regulated by Portaria 352/2024/1, the IFICI offers a simplified framework designed to attract talent in scientific, technological, and innovation-driven fields.
One of the most common questions we receive at GoalSeek concerns the treatment of foreign employment income under IFICI—particularly for residents arriving in 2024 and 2025.
Below, I break down exactly how foreign income is taxed, when it qualifies for exemption, and how this interacts with the overall structure of the IFICI regime.
What Is IFICI and Who Can Benefit?
The IFICI regime applies to individuals who:
• Become tax residents in Portugal from 2024 onward
• Have not been residents in the previous five years
• Perform eligible activities in scientific research, innovation, technology or high-skilled management roles
• Are not beneficiaries of the former NHR regime
• Are included in one of the categories listed in Article 58-A(1) EBF (alíneas a) to f))
A key feature of IFICI is its 10-year duration and the special 20% IRS rate applied to eligible Portuguese-source employment or self-employment income (categories A and B).
However, the treatment of foreign income is where IFICI provides a significant strategic advantage.
Foreign Employment Income Under IFICI: Is It Taxed in Portugal?
Short answer: foreign Category A income is exempt from IRS in Portugal.
According to Article 81(4) of the IRS Code and confirmed by the OCC Practical Guide (March 2025), individuals registered under IFICI benefit from exemption with progression on most foreign-source income.
This includes:
• Employment income (Category A)
• Self-employment income (Category B)
• Capital income (E)
• Rental income (F)
• Capital gains (G), except on Portuguese real estate
The exemption applies as long as the income is not paid from a jurisdiction on Portugal’s list of “clearly more favourable tax regimes” (the so-called “tax haven” list).
If the payer is located in such a jurisdiction, the income is taxable at a flat 35% rate, as required under Article 81(5) of the IRS Code.
Why the Exemption Matters for New Residents
For many professionals moving to Portugal—particularly those working remotely for international employers—this exemption is one of the most valuable components of IFICI.
The benefit is twofold:
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Your foreign salary is not taxed in Portugal, reducing overall IRS liability.
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The Portuguese-source income related to your qualified activity is taxed at a favourable 20% rate, rather than progressive rates up to 48%.
This creates a highly competitive environment for talent attraction, especially for expatriates who maintain income streams abroad.
What About Proof and Compliance?
For individuals entering via alínea c), sub-alínea i) — “highly qualified professions” — the process is particularly streamlined.
Under this route:
• The taxpayer must hold suitable academic qualifications (usually a bachelor’s degree + 3 years experience, master’s degree, or PhD).
• The company where the work is performed simply confirms the role as a highly qualified position through the Portal das Finanças by 15 March.
• No CAE restrictions or export-volume requirements apply (those belong to sub-alínea ii)).
Once enrolled, the foreign salary is treated as exempt foreign-source income for IRS purposes.
Key Takeaways for Expats and Remote Employees
• IFICI offers exemption on foreign employment income, making it ideal for remote workers employed by companies outside Portugal.
• The 20% IRS rate applies only to eligible Portuguese-source activity.
• Income from tax-haven jurisdictions does not qualify for exemption and is taxed at 35%.
• The regime lasts for 10 consecutive years, with flexibility to pause and restart if the individual temporarily ceases residency.
• The regime requires an annual confirmation that the taxpayer still performs an eligible activity.
Moving to Portugal in 2024–2025? IFICI May Be Your Optimal Path
For highly qualified professionals, researchers, engineers, IT specialists, directors, and innovation-driven profiles, IFICI provides a clean, modern alternative to the discontinued NHR regime. The combination of a 20% rate on domestic income and exemption on most foreign income makes Portugal attractive not only for innovators, but also for globally mobile professionals.
At GoalSeek, we support individuals and companies through the full process:
• IFICI eligibility assessment
• Registration and documentation
• Tax filing under the new regime
• International coordination to avoid double taxation
• Compliance with Portuguese IRS and Social Security rules
If you would like a personalised simulation or analysis of your income streams under IFICI, feel free to contact us.
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