Portugal's tax system for expatriates has garnered significant attention in recent years, owing to its favourable policies designed to attract foreign residents. The Non-Habitual Resident (NHR) regime, in particular, offers substantial tax benefits to qualifying individuals. Under this scheme, eligible expats may enjoy a flat 20% tax rate on certain Portuguese-sourced income and potential tax exemptions on foreign-sourced income for a period of ten years. It is crucial for expatriates to understand that whilst these incentives are appealing, they are subject to specific conditions and limitations. For instance, to qualify for NHR status, one must not have been a tax resident in Portugal within the previous five years. Furthermore, the tax treatment varies depending on the nature and source of income, with different rules applying to employment income, pensions, and investment returns. Prospective expats should also be aware of Portugal's progressive tax rates, which apply to income not covered by the NHR regime. These rates range from 14.5% to 48%, with additional surcharges on higher incomes. It is advisable for individuals considering relocation to Portugal to seek professional tax advice to fully comprehend the implications of the Portuguese tax system on their specific circumstances.