Inheritance Tax Changes Open Up New Opportunities for British Expats Living in Portugal
Upcoming changes to UK inheritance tax (IHT) rules on unspent pension funds may encourage more British families to relocate to countries like Portugal, as they seek to protect their wealth from increased tax burdens.
Starting in April 2027, new rules proposed by the UK Chancellor will take effect.
Under the new rules, any unused pension funds will be counted as part of a person’s estate and could be subject to inheritance tax after death.
Currently, inherited pension funds are not subject to inheritance tax or income tax. This only applies if the individual passed away beyond a certain age. However, under the new legislation, these funds could first face inheritance tax, with income tax then applied to what remains.
This may push more Britons to seek more favourable tax environments abroad and increase interest in moving overseas.
Portugal’s favourable tax conditions continue to play a major role. For many years, the Non-Habitual Residency (NHR) regime provided residents with reduced taxation.
Portugal has consistently attracted high-net-worth individuals who seek to benefit from its economic and political environment, as well as its climate and culture. lifestyle.
Portugal’s reputation as a safe, stable country with a lower cost of living than the UK continues to drive a strong grown demand from people wanting to relocate.
There are some excellent opportunities for investment and tax through both the original NHR regime and the new NHR 2.0. But also, Portugal’s Golden Visa is an alternative investment funds that offer attractive benefits, including no tax on capital gains for foreign investors.
