New rules for former residents looking to return to Portugal: what’s changed in the State Budget
Publication Date: 16/07/2025
If you’re thinking about returning to Portugal in the coming years, here’s some good news: the State Budget introduced changes to the Return Program (Programa Regressar), with tax benefits and financial support to make your move easier.
Current Tax Regime — “Programa Regressar” (Return Program)
The Return Program still offers significant tax relief for those who come back to live in Portugal:
Article 12-A of the Personal Income Tax Code (Código do IRS) allows a 50% exemption on employment income (salaried, business or professional), for 5 years, up to a maximum of €250,000/year.
To qualify, you must:
Become a tax resident in 2025, 2026 or 2027;
Not have been a tax resident in Portugal in the previous 5 years (for example: you return in 2025, having lived abroad from 2020 to 2024);
Have been a tax resident in Portugal before that period of absence.
Income above €250,000/year does not benefit from the exemption.
This regime remains in effect until 31 December 2026.
Eligibility Conditions
To join the Return Program, you must:
Not have been a tax resident in Portugal in the last 5 years;
Have been a resident in Portugal before that period of absence (before 2020);
Have your tax and social security situation regularised.
The Regressar Program offers tax benefits, but the process involves several documents and complex rules, but we can help you. Book your tax consultation here.
Additional support from IEFP
In addition to the tax benefit, the Public Employment and Training Institute (Instituto do Emprego e Formação Profissional — IEFP) provides financial support to help with your return:
Between €2,546 and €3,565, depending on the type of employment contract;
A 20% increase per household member and a 25% increase for those moving to inland regions;
Additional support to cover travel costs (up to €1,527.78) and qualification recognition (up to €763.89).
Key points to keep in mind
Before moving forward, note that:
The process can be bureaucratic and requires several supporting documents — so prepare your paperwork in advance.
The old Non-Habitual Resident (NHR) regime was abolished in 2024, replaced by the new ex-resident regime and incentives for research and development.
Discussions are still ongoing about possible additional benefits for pensioners and for settling in inland areas of the country.
Final Resume
Returning to Portugal offers significant tax advantages, but requires preparation and detailed knowledge of the rules. The Regressar Program is a great opportunity, but there are documentation and deadlines to meet. 👉 We're here to help you every step of the way.