Guide on the Tax Incentive for Scientific Research and Innovation (IFICI)

Circular Letter No. 20276, 26/02/2025 - Portuguese Tax and Customs Authority (Autoridade Tributária e Aduaneira)

On 26 February 2025, the Portuguese Tax and Customs Authority issued Circular Letter No. 20276, an official Guide and FAQ on the Tax Incentive for Scientific Research and Innovation (IFICI). It builds on Ordinance No. 352/2024/1 of 23 December, spelling out in plain terms how the regime is applied in practice.

A. What the Guide states:

The Guide reinforce that the "IFICI, the tax incentive for scientific research and innovation, is a regime created by Article 58-A of the Tax Benefits Statute (EBF), which establishes personal income tax (IRS) benefits with the aim of attracting talent and encouraging scientific research and innovation in Portugal."

B. Two things it does:

The first part is a step-by-step Guide covering eligibility, registration, required documents, and withholding tax. 

The second is a 32-question FAQ addressing real-world scenarios - from freelancers and startup employees to professors and company partners - clarifying who qualifies and who doesn't.

C. Why it matters:

Beyond restating the rules, the Guide resolves genuine grey areas: how the 10-year benefit period works if you leave and return to Portugal, what happens if your registration documents are incomplete, and which entity - Tax Authority, AICEP, or IAPMEI - reviews your specific case.

Read the full Guide: 

1. General requirements

Taxable persons who meet the following conditions ( Anyone who benefits or has benefited from this regime, as from 2025, may not benefit from the regime provided for in Article 12-B of the IRS Code (“IRS Jovem” / “Young IRS”))  may apply for registration for IFICI purposes:

• Become tax resident in Portuguese territory  in the year in relation to which they intend taxation under IFICI to begin;
• Not have been considered resident in Portuguese territory in any of the five preceding years relative to the year in relation to which they intend taxation under IFICI to begin;
• Carry out the activities and professions or jobs falling within any of the subparagraphs of paragraph 1 of Article 58-A of the EBF (see section 2, “Requirements relating to the activity/profession performed and respective entities”);
• In each year of the period of application of the regime, and at any time during that year, be considered tax resident in Portuguese territory;
• Earn, in each year of application of the regime, income falling within the scope of one of the activities listed in paragraph 1 of Article 58-A of the EBF;
• Not benefit, or have benefited, from the non-habitual resident regime;
• Not have opted for taxation under Article 12-A of the IRS Code (“Tax regime applicable to former residents” – Programa Regressar);
• Not have previously benefited from IFICI.

2. Requirements relating to the activity/profession performed and respective entities

3. Registration procedure

Registration requests are submitted on the Portuguese Tax Authority Portal, following authentication, completion of the form, and submission, and must be accompanied by the documents required for assessment of the request, under Article 4 of Ordinance No. 352/2024/1, of 23 December. 

The request must be submitted by 15 January  of the year following that in which the beneficiary becomes resident in Portuguese territory. Verification of the requirements relating to the activity performed is the responsibility of the following entities:

• The registration requests of taxable persons, as well as changes to the elements contained in the registration; and
• Compliance with the requirements relating to the activity performed by the taxable persons.

The Tax Authority is responsible for verifying the other legal requirements, namely those relating to residence.

4. Verification of requirements and record-keeping

Except in the case of subparagraph c) of paragraph 1 of Article 58-A of the EBF, when submitting the request beneficiaries must provide the following documents:

• Copy of the employment contract, when the activity performed is a job;
• Up-to-date permanent commercial certificate, when the activity performed is that of a member of a governing body;
• Copy of the scholarship contract, when the activity performed is scientific research;
• Proof of academic qualifications, when applicable;
• Declaration issued by the company in which the activity is performed, certifying compliance with the requirements relating to the activity performed, in the case of the activities provided for in subparagraphs b), d) and e) of paragraph 1 of Article 58-A of the EBF;
• Other documents that may be requested.

In the case of subparagraph c) of paragraph 1 of Article 58-A of the EBF, by the end of February , Tax Authority makes available, in the restricted area of the Portuguese Tax Authority Portal of the company where the beneficiary performs their activity, a confirmation request, to be completed by 15 March :

• That the company meets the requirements set out in sub-subparagraph i) or ii) of that subparagraph; and
• That the beneficiary performs the highly qualified profession.

Whatever the activity performed, in the case of regulated professions, the beneficiary must also comply with the requirements of the applicable legislation.

The entities responsible for assessing requests and the corresponding supporting documents, as well as the companies in which the activity is performed, have a duty to keep and preserve the documents for 10 years, and Tax Authority may access such records and carry out inspections .

The beneficiary must also keep and preserve evidence of the performance of the activity and the corresponding earning of income, as well as of the other legal requirements for entitlement to IFICI, and must produce it whenever requested by Tax Authority.

5. Communication of changes

By 15 January  of the following year, beneficiaries must communicate any changes on the Portuguese Tax Authority Portal, by authentication, completion and submission of the form, accompanied by the documents needed for assessment of the request, whenever:

• They cease to meet the requirements for benefiting from the regime; or
• There is a change to the elements contained in the registration.

Whenever the communication of changes concerns the performance of a new activity falling within the regime, entitlement to the benefit is maintained, provided the new activity begins within a maximum of six months of the end of the previously performed activity.

6. Consultation of the request

By 31 March  of each year, Tax Authority makes information available to beneficiaries on the status of their registration.

Beneficiaries may obtain proof of that status through their restricted area on the Portuguese Tax Authority.

7. Withholding tax

Entities that pay or make available to beneficiaries category A or category B income resulting from activities entitling them to this regime must withhold tax on such income at a rate of 20%, upon presentation of proof of the registration request.

8. Entry into force, effects, and transitional regime

Ordinance No. 352/2024/1, of 23 December, entered into force on the day following its publication and applies to taxable persons who become tax resident in Portuguese territory as from 1 January 2024.

For the purposes of applying the regime to income earned in 2024, the following special deadlines apply:

• Anyone who became tax resident in 2024 may submit the registration request and communicate changes until 31 March 2025;
• The entities competent to verify the activity requirements, as well as the companies in which activities under subparagraph c) of paragraph 1 of Article 58-A of the EBF are performed, may make the communication or confirmation, respectively, until 30 April 2025;
• Tax Authority makes information available to beneficiaries on the status of their registration until 15 May 2025. 

The granting of a registration request terminates any ongoing registration procedures under:

• The non-habitual resident regime, submitted under paragraphs 3 to 5 of Article 236 of Law No. 82/2023, of 29 December (State Budget Law for 2024);
• The IFICI regime, submitted under the terms of paragraph 9 of Article 58-A of the EBF.

Taxable persons who submitted the registration request by the date of publication of Ordinance No. 352/2024/1, of 23 December, and who meet the requirements of paragraph 8 of Article 58-A of the EBF , retain the right to benefit from the regime for the applicable period, provided the corresponding requirements continue to be met.

Frequently Asked Questions (FAQ)

1. What is IFICI?

IFICI, the tax incentive for scientific research and innovation, is a regime created by Article 58-A of the Tax Benefits Statute (EBF), which establishes personal income tax (IRS) benefits with the aim of attracting talent and encouraging scientific research and innovation in Portugal.

2. How is income taxed?

National source:

• Categories A and B:
• Special rate of 20%, provided the requirements of the regime are met;
• General IRS taxation rules in other cases.
• Other categories: general IRS taxation rules.

Foreign source:

• General rule: IRS exemption, except for category H income.
• Income of any category paid or made available by non-resident entities domiciled in a country, territory or region subject to a clearly more favourable tax regime, included on a list approved by ordinance of the Government member responsible for finance , is taxed as follows:
• By withholding tax, at the final rate of 35%, when paid by or through entities with head office, effective management or a permanent establishment in Portuguese territory to which the payment is attributable and which have or must have organised accounting;
• By withholding tax, at the final rate of 35%, in the case of income paid through entities mandated to make such payment and having head office, effective management or a permanent establishment in Portuguese territory;
• Autonomously, at the rate of 35%, in other cases.

3. What are the conditions for benefiting from IFICI?

Portuguese or foreign citizens may benefit from IFICI where they:

• Have not been tax resident  in Portugal in the five preceding years and become tax resident in Portugal;
• Perform the professions or activities and earn income falling within any of the subparagraphs of paragraph 1 of Article 58-A of the EBF;
• Do not benefit, and have not benefited, from the non-habitual resident regime; do not opt for taxation under Article 12-A of the IRS Code; and have not previously benefited from IFICI.

4. What are the activity requirements, and what is the registration procedure for IFICI?

The request must be submitted on the Portuguese Tax Authority Portal by 15 January of the year following that in which the person becomes resident in Portuguese territory.

Where registration is made outside this deadline, IFICI takes effect from the year in which registration is made and applies for the remaining legal period.

Example: a taxable person became tax resident in Portuguese territory, under the IRS Code, in 2025, and meets all the requirements to benefit from IFICI, but only submits the registration request on 10 January 2029. In this case, they may benefit from IFICI for six years, from 2029 (the year of registration) to 2034 (the year in which the ten-year period would have ended, had registration been made by 15 January 2026).

5. Which entity is competent to assess compliance with the activity requirements?

The competent entity depends on the activity performed, as set out below:

6. I am resident in the Autonomous Region of the Azores. Can I only benefit from IFICI once a regional legislative decree exists?

No. If you meet the requirements provided for any of the other activities, as well as the remaining legal requirements, you may apply for IFICI registration based on the activity performed.

7. I am employed at a startup and benefit from IFICI under subparagraph f) of paragraph 1 of Article 58-A of the EBF. Besides my employment income from that company, I hold shares in a company in Dubai, which distributes dividends annually. How will I be taxed?

Your category A income is taxed at the special rate of 20%, under Article 58-A, No. 2, of the EBF.

The dividends distributed by the company in Dubai – the United Arab Emirates being a country, territory or region subject to a clearly more favourable tax regime  – are taxed at a rate of 35%, under Article 81, No. 5, of the IRS Code.

8. I am a university professor and teach at a higher education institution in Portugal under a service-provision contract. Can I benefit from IFICI?

Yes, provided you meet the other legal requirements, you are eligible to benefit from IFICI under subparagraph a) of paragraph 1 of Article 58-A of the EBF.

9. I have a service-provision contract with an entity carrying out an economic activity recognised by AICEP under the respective notice. Am I eligible for IFICI?

No. The concept of “job”, referred to in subparagraphs a), b), d), f) and g) of paragraph 1 of Article 58-A of the EBF, necessarily implies the existence of an employment contract.

10. I am a partner in a single-member company that meets the requirements of subparagraph d) of paragraph 1 of Article 58-A of the EBF, under the notice published by IAPMEI. Can I benefit from IFICI?

That subparagraph covers only qualified jobs under that notice, provided the person holds at least a post-secondary non-tertiary qualification level, or is a member of a governing body. Accordingly, the partners of a company cannot, in that capacity, benefit from IFICI. However, managing partners of single-member companies (as members of a governing body) are eligible for IFICI, provided they meet the other requirements.

11. What are the highly qualified professions for IFICI purposes, provided for in Annex I of Ordinance No. 352/2024/1, of 23 December?

The highly qualified professions for the purposes of subparagraph c) of paragraph 1 of Article 58-A of the EBF are the following:

• 112 – General director and executive manager, of companies
• 12 – Directors of administrative and commercial services
• 13 – Directors of production and specialised services (except 1349)
• 21 – Specialists in physical sciences, mathematics, engineering and related technical fields (except 216)
• 2163.1 – Industrial or equipment product designer
• 221 – Doctors
• 231 – University and higher education teachers
• 25 – Information and communication technology (ICT) specialists

Workers performing these activities must hold:

• A doctorate; or
• A bachelor's or master's degree and at least 3 years of professional experience.

12. How should doubts about this list of highly qualified professions be resolved?

All interpretative doubts concerning the scope of the activities in Annex I of Ordinance No. 352/2024/1, of 23 December, must be resolved by reference to the codes of the Portuguese Classification of Professions annexed to Resolution No. 967/2010 of the Higher Council for Statistics, of 5 May 2010, published in the Diário da República, 2nd series, No. 106, of 1 June 2010, together with the corresponding explanatory notes.

13. What are the Portuguese Classification of Economic Activities (CAE) codes for industrial and service companies, for IFICI purposes, provided for in Annex II of Ordinance No. 352/2024/1, of 23 December?

The eligible CAE codes for the purposes of sub-subparagraph ii) of subparagraph c) of paragraph 1 of Article 58-A of the EBF are the following:

• Mining and quarrying – divisions 05 to 09
• Manufacturing – divisions 10 to 33
• Information and communication activities – divisions 58 to 63
• Research and development on natural sciences – group 721
• Higher education – subclass 85420
• Human health activities – subclasses 86100 to 86904

14. How should doubts about this list of activities be resolved?

All interpretative doubts concerning the scope of the activities in Annex II of Ordinance No. 352/2024/1, of 23 December, must be resolved by reference to the Portuguese Classification of Economic Activities, Revision 3 (CAE – Rev. 3), approved as an annex to Decree-Law No. 381/2007, of 14 November, together with the corresponding explanatory notes.

15. What are the qualified jobs for IFICI purposes, provided for in Annex A of the respective notices?

The qualified jobs for the purposes of subparagraph d) of paragraph 1 of Article 58-A of the EBF are the following:

• 112 – General director and executive manager, of companies
• 12 – Directors of administrative and commercial services
• 13 – Directors of production and specialised services
• 14 – Directors of hospitality, catering, trade and other services
• 21 – Specialists in physical sciences, mathematics, engineering and related technical fields
• 221 – Doctors
• 231 – University and higher education teachers
• 241 – Finance and accounting specialists (except 2411)
• 25 – Information and communication technology (ICT) specialists
• 2654 – Film, theatre, television and radio directors, producers and related professionals
• 31 – Science and engineering technicians and associate professionals, intermediate level

Administrators, managers or general directors of companies are also considered qualified jobs for the purposes of subparagraph d) of Article 58-A of the EBF.

16. How should doubts about this list of qualified jobs be resolved?

All interpretative doubts concerning the scope of the activities in Annex A of the AICEP and IAPMEI notices must be resolved by reference to the codes of the Portuguese Classification of Professions annexed to Resolution No. 967/2010 of the Higher Council for Statistics, of 5 May 2010, published in the Diário da República, 2nd series, No. 106, of 1 June 2010, together with the corresponding explanatory notes.

17. What are the Portuguese Classification of Economic Activities (CAE) codes for economic activities recognised by AICEP or IAPMEI as relevant to the national economy, for IFICI purposes, provided for in Annex B of the respective notices

The eligible CAE codes for the purposes of subparagraph d) of paragraph 1 of Article 58-A of the EBF are the following:

• Mining and quarrying – divisions 05 to 09
• Manufacturing – divisions 10 to 33
• Electricity, gas, steam, hot and cold water and air-conditioning supply – division 35
• Construction – division 42
• Accommodation and similar establishments – classes 5511 and 5512
• Information and communication activities – divisions 58 to 63
• Financial and insurance activities – classes 6420 and 6630 
• Consultancy, scientific, technical and similar activities – class 7010 and divisions 71 to 72
• Administrative and support service activities – class 8211
• Education – class 8542
• Human health and social work activities – division 86 (except subclasses 86905 and 86906)

Also included are other economic activities carried out within the scope of investment projects recognised as Projects of National Interest (PIN) or as Investment Projects for the Interior (PII).

18. How should doubts about this list of activities be resolved?

All interpretative doubts concerning the scope of the activities in Annex B of the respective notices must be resolved by reference to the Portuguese Classification of Economic Activities, Revision 3 (CAE – Rev. 3), approved as an annex to Decree-Law No. 381/2007, of 14 November, together with the corresponding explanatory notes.

19. I hold a doctorate, perform a highly qualified profession (under Annex I of Ordinance No. 352/2024/1, of 23 December), and the company I work for is an industrial and service company with a CAE code listed in Annex II to that same Ordinance. This company's sales to customers in other European Union countries represent more than 50% of its turnover. Does this company meet the export requirement of Article 58-A, No. 1, c), sub-subparagraph i), of the EBF?

Yes. Intra-Community supplies count for the purposes of meeting this requirement, so in that situation the requirement is met.

20. What is the duration of IFICI?

The period is 10 consecutive years, and it may be resumed, in the event of an interruption, for the remaining years, provided the beneficiary again becomes tax resident in Portugal and again earns income falling within the activities provided for in paragraph 1 of Article 58-A of the EBF.

Example: a taxable person obtained IFICI status in 2024, with the benefit running from then and being enjoyed until 2028 (five years), having resided in another country in 2029. In 2030, they again become tax resident in Portugal, performing one of the activities provided for in paragraph 1 of Article 58-A of the EBF. In that case, the taxable person may resume IFICI for the remaining 4 years – that is, from 2030 to 2033.

21. I submitted a registration request under IFICI. How can I check the status of my request?

By 31 March of each year, Tax Authority makes information available to taxable persons on the status of their registration, which can be consulted through their restricted area on the Portuguese Tax Authority Portal.

22. What must I do if I stop meeting the IFICI requirements?

Whenever the requirements for benefiting from the regime cease to be met, the beneficiary must communicate this by 15 January of the following year. The right to the tax benefit ceases on the date the legal requirements cease to be met.

23. What must I do if a requirement or element of my registration changes, but I continue to benefit from IFICI – for example, at a different company?

Whenever there is a change to the elements contained in the registration – namely the company for which the person works, or the entity competent to assess the activity requirements – the beneficiary must communicate this on the Portuguese Tax Authority Portal by 15 January of the year following that change.

In addition, a new registration request must be submitted under the general terms. Note that the 10-year benefit period does not restart with the new registration request, but rather continues for the remaining period.

Example:

• On 15 January 2025, a teaching activity began at a higher education institution, which ended on 15 June 2026;
• On 15 September 2026, an activity began in a job at a startup;
• Since the new activity began within six months of the end of the previously performed activity, entitlement to IFICI is maintained;
• By 15 January 2027, this change must be communicated on the Portuguese Tax Authority Portal, and a new registration request submitted.

24. I submitted the IFICI registration request. What withholding tax rate applies to my salary? What must I do to benefit from this withholding rate?

Category A or B income relating to the activity that entitles you to benefit from IFICI may benefit from a withholding tax rate of 20%. To benefit from this rate, you must present proof of submission of the registration request to the entity paying the income.

25. What deadlines apply to those who became tax resident in 2024?

The applicable deadlines  are as follows:

• Registration request and communication of changes: until 31 March 2025.
• Communication by entities to Tax Authority, and confirmation by companies in the case of activities under subparagraph c) of paragraph 1 of Article 58-A of the EBF: until 30 April 2025.
• Availability of information by Tax Authority: until 15 May 2025.

26. I requested my IFICI registration before the publication of Ordinance No. 352/2024/1, of 23 December, and the activity I perform is a highly qualified profession under Ordinance No. 12/2010, of 7 January. Am I entitled to the benefit?

If your activity is listed in the table of Ordinance No. 12/2010, you retain the tax benefit for as long as you continue to perform that activity and hold IFICI status, even if the activity is not listed in Ordinance No. 352/2024/1, of 23 December, provided the other requirements continue to be met.

For example, if you submitted the registration request in October 2024, you will be entitled to benefit from the regime until 2033, provided that, and for as long as, you continue to perform that activity or begin performing an activity provided for in Ordinance No. 352/2024/1, of 23 December.

27. What happens to registration requests in progress under other regimes, and to registrations made before the publication of Ordinance No. 352/2024/1, of 23 December?

The granting of a registration request under IFICI after 23 December 2024 terminates ongoing registration procedures under the non-habitual resident regime or under the IFICI regime, in the latter case when submitted by 23 December 2024.

28. If I complete my registration and submit documentation, and that documentation is insufficient, will my registration be automatically cancelled?

No. If it is found that the registration procedure was not properly completed, you will be notified to submit the elements considered necessary, within the deadline indicated in that notification.

29. Suppose that, in 2027, I have already benefited from IFICI for 3 years because my company developed a research and development project, certified by ANI and eligible for SIFIDE, which has now ended. Can I still benefit from the regime for the remaining 7 years?

In principle, no. Under paragraph 3 of Article 58-A of the EBF, “the right to be taxed under this article (…) depends on the taxable person (…) continuing to earn, in each year, income falling within the exercise of one of the activities listed in paragraph 1.” Since the project has ended, the requirements of subparagraph e) of paragraph 1 of that Article 58-A are no longer met. However, should you come to earn income falling within that or another subparagraph of paragraph 1 of Article 58-A of the EBF within six months of the project's end, you may continue to benefit from IFICI for the remaining period.

30. I am aware of another beneficiary who was asked for different documentation than mine for their registration. Should the documentation requested not be the same?

Not necessarily. Each entity is responsible for assessing different requirements of the regime and different activities, and may therefore need to request additional or different documentation, depending on the activity and the specific case. The table below sets out examples of documents entities may request as part of the registration process.

31. After completing my registration, do I need to keep the documentation? Does the company where I perform my activity have to archive that documentation?

IFICI beneficiaries must keep and archive the evidence of the performance of the activity and the corresponding earning of income, as well as the other legal requirements for the right invoked in any year of application of the regime, which Tax Authority may request.

Companies and other entities in which the activity is performed are required to keep the relevant documentation for this benefit for a period of 10 years.

32. I perform a qualified profession at a company that carries out economic activities recognised as relevant to the national economy by both AICEP and IAPMEI, and I want to register for IFICI. Which of these entities is competent to assess my request?

AICEP is the competent entity to assess registration requests from individuals seeking IFICI under subparagraph d) of paragraph 1 of Article 58-A, where the individuals perform their duties in a legal person whose consolidated annual turnover in the immediately preceding financial year was equal to or greater than €75 million, or where they pursue their activity within the scope of a PIN or PII project.

In other cases, the competent entity is IAPMEI (including for a company without approved accounts and unable to demonstrate an annual turnover, because it was incorporated in the same year as the request or in the previous year and its accounts have not yet been approved – the competent entity is likewise IAPMEI).