Law verified as at 5 October 2026
The French law cited is the law in force at that date. It may change, in particular with the 2027 Finance Law. Portuguese law is presented on the basis of the texts published in the Diário da República and information from the Portuguese tax authority: how it applies to a given situation should be confirmed with a local adviser.
Portugal is among the European destinations studied by French people who are considering leaving France. The landscape has changed, however: the non-habitual resident regime has been closed to new entrants and replaced by a narrower scheme reserved for certain activities. Above all, moving to Portugal does not sever the tax link with France for the assets and income that remain there.
The overall method for a departure is described on our page on transferring your tax residence.
What remains of Portugal’s non-habitual resident (NHR) regime?
The residentes não habituais regime was revoked by the Portuguese Budget Law for 2024, Lei n.º 82/2023 of 29 December 2023. It continues to apply, until the end of their ten-year period, to people who already benefited from it and to those covered by the transitional regime of Article 236 of that law (residence acquired no later than 2024, subject to conditions). It is no longer open to new arrivals.
This point is the main source of misunderstanding for a plan made in 2026: content that presents the non-habitual resident regime as an available option describes an outdated state of the law.
What is the IFICI regime?
Article 263 of the same law created the tax incentive for scientific research and innovation, known by the acronym IFICI, codified in Article 58.º-A of the Estatuto dos Benefícios Fiscais. Its registration procedure was laid down by Portaria n.º 352/2024/1 of 23 December 2024.
The information published by the Portuguese authorities describes a scheme that is markedly more restrictive than its predecessor.
- Entry condition: becoming tax resident in Portugal without having been tax resident there in the previous five years, and in particular not benefiting, and never having benefited, from the non-habitual resident regime or, previously, from the IFICI regime.
- Activity condition: carrying on an eligible activity, in particular higher education and scientific research, certain highly qualified professions in the listed sectors, or a role in a company qualifying as a startup.
- Benefit: a special rate of 20% on Portuguese-source income in categories A and B derived from the eligible activity, for ten consecutive years.
- Formality: an application for registration with the competent body, no later than 15 January of the year following the year in which the person becomes resident, under Article 2 of the portaria.
Unlike the previous regime, the benefit is tied to a qualified professional activity. A retiree or a person living on investment income does not, by definition, meet the activity condition.
How does the France–Portugal tax treaty allocate taxing rights?
The tax treaty between France and Portugal was signed on 14 January 1971 and published by Decree No. 72-1261 of 14 December 1972. It entered into force on 18 November 1972 and was amended by a protocol signed on 25 August 2016, which entered into force on 1 December 2017, and then by the Multilateral Convention to prevent base erosion and profit shifting.
The French administrative guidelines set out the allocation by category of income.
| Category | Treaty rule |
|---|---|
| Income from immovable property | Taxable in the State where the property is situated |
| Capital gains on immovable property | Taxable in the State where the property is situated |
| Dividends | Taxable in the beneficiary’s State of residence; the source State may levy a withholding tax capped at 15% |
| Interest | Taxable in the State of residence; withholding tax capped at between 10% and 12% depending on the type of security |
| Royalties | Taxable in the State of residence; withholding tax capped at 5% |
| Salaries and wages | Taxable in the State where the work is performed, except for temporary assignments not exceeding 183 days in the tax year, subject to conditions |
| Private pensions | Taxable only in the beneficiary’s State of residence |
Public-sector pensions follow a separate regime, to be checked case by case according to the paying body and the career concerned.
What France continues to tax
Transferring your residence does not remove French taxation of what remains in France.
- The French real estate wealth tax (IFI) remains due on real estate assets and rights located in France only, above €1,300,000 of net taxable value on 1 January, under Article 964 of the French Tax Code (code général des impôts, CGI).
- French real estate capital gains bear the 19% levy under Article 244 bis A of the CGI, plus social levies.
- French rental income remains taxable in France, at the minimum rate under Article 197 A of the CGI.
- Gifts and inheritances remain taxable in France in the cases set out in Article 750 ter of the CGI, in particular where the heir is domiciled in France on the date of the transfer and has been so domiciled for at least six of the last ten years.
- Exit tax may apply on departure, with automatic deferral, as Portugal is a member of the European Union.
A worked example
A retired couple moves to Porto in 2026. They receive €62,000 of French private pensions a year and keep a rented flat in Bordeaux, valued at €420,000, which produces €14,000 of rental income.
- Private pensions: the treaty allocates the taxing right to the State of residence alone. They are taxable in Portugal under the standard Portuguese progressive scale, as the IFICI regime is not open to a situation without an eligible activity.
- Rental income: as the property is located in France, the income remains taxable there. The 20% minimum rate applies to €14,000, i.e. €2,800, excluding social levies, unless the average worldwide rate is elected.
- IFI: the net taxable French real estate assets, €420,000, remain below the €1,300,000 threshold. No IFI is due.
- If the flat is sold: 19% levy on the capital gain, plus social levies; as Portugal is a member of the European Union, no accredited tax representative is required.
Who this move suits, and who it does not
It may suit a qualified professional carrying on an activity eligible for the IFICI regime, a retiree whose pensions are private and who accepts the standard Portuguese progressive scale, or a person whose wealth is mainly in movable assets that are actually transferred.
It is a poor fit for a person whose family home remains in France, for an owner whose wealth is mainly French real estate, and for anyone relying on a non-habitual resident regime that is no longer open.
Key points
- The non-habitual resident regime has been closed to new arrivals since the Portuguese Budget Law for 2024.
- The IFICI regime replaces it, but it requires a qualified activity: it does not cover retirees or people living on investment income.
- The 1971 treaty allocates private pensions to the State of residence alone, and leaves France the right to tax French real estate assets and income.
FAQ
Does the non-habitual resident regime still exist?
It was revoked by the Portuguese Budget Law for 2024. People who benefited from it keep their status until the end of their period, but it is no longer open to new arrivals.
Can a French retiree benefit from the IFICI regime?
The regime requires an eligible activity, in particular research, higher education or a qualified profession in a listed sector. A situation without a professional activity does not meet this condition. This point should be confirmed with a local adviser in light of the exact situation.
Will my French pension be taxed in France or in Portugal?
The treaty allocates the taxation of private pensions to the State of residence alone, so to Portugal for a Portuguese resident. Public-sector pensions follow a separate regime, to be checked according to the paying body.
Do I have to sell my French flat before leaving?
Nothing requires it. The property you keep remains taxable in France on its income, for IFI above the threshold and on the capital gain if it is sold. The choice depends on the yield, the time horizon and the cost of managing it from a distance.
Does exit tax apply if I move to Portugal?
It may apply if the thresholds of Article 167 bis of the CGI are reached. As Portugal is a member of the European Union, the payment deferral applies automatically, without security or prior application.
Assessing your move to Portugal
We analyse the applicable treaty, how it interacts with Portuguese law and the treatment of the assets you keep in France, working with a local adviser on Portuguese domestic law. See our analyses on reading the departure statistics (in French), on the Italian flat-tax regime, on international successions and France, and our page on leaving France in compliance with the rules. Every situation is different and deserves a dedicated analysis.
Official sources
- Tax treaty between France and Portugal of 14 January 1971, text and protocols – impots.gouv.fr (in French)
- BOFiP, tax treaties between France and Portugal – bofip.impots.gouv.fr (in French)
- BOFiP, rules for taxing the various categories of income, France–Portugal treaty – bofip.impots.gouv.fr (in French)
- Portaria n.º 352/2024/1 of 23 December 2024, regulations for the IFICI regime – diariodarepublica.pt
- Portuguese tax authority, frequently asked questions on the IFICI regime – portaldasfinancas.gov.pt
- Article 964 of the French Tax Code (code général des impôts), real estate wealth tax – Légifrance (in French)
- Article 244 bis A of the French Tax Code (code général des impôts), real estate capital gains of non-residents – Légifrance (in French)
- Article 750 ter of the French Tax Code (code général des impôts), territorial scope of gift and inheritance duties – Légifrance (in French)
This article sets out the law for general information purposes, as verified at the date of publication. Foreign law is presented subject to confirmation by a local adviser. It does not constitute legal advice. Every situation is different and deserves a dedicated analysis. Content compliant with the professional conduct rules of the legal profession.
