NHR status cannot be denied to the people who missed the deadline for the application

 Vasco Apolinário Rodrigues | Lawyer

We have been assisting our clients in reverting NHR rejections over the past years, arguing that missing the timeline for the application cannot be used as a reason to reject any NHR application.

Several decisions have been taken by the Portuguese Arbitral Tax Court (CAAD) confirming our understanding, but it is only possible to claim to the Portuguese Arbitral Court regarding the tax assessment and not claim against the NHR rejection. 

However, on the 29th of May 2024, the Supreme Administrative Court (STA), the top court in Portugal for administrative and tax matters, ruled that NHR status is a matter of right and cannot be denied to people who fail to meet the 31st of March deadline.

With this decision, it will be easier and faster to revert any NHR rejection by the Tax Authority when the application was not submitted within the deadline. 

Until now, the tax authorities denied NHR status to anyone applying after the formal deadline of the 31st of March of the year after the person becomes a tax resident; however, with this decision issued by the Supreme Administrative Court (STA), the Tax Authority cannot use that argument to reject the NHR applications.

This decision ruled that the deadline for registration under the NHR regime is only a declarative obligation and not a criterion for eligibility for NHR status, which means that taxpayers who meet the requirements for NHR status but who missed the registration deadline can still apply for NHR status.

Although we do not expect the Tax Authority to accept the NHR application submitted after the deadline, we consider that it will be possible to claim and revert the decision through an administrative appeal or Court appeal and avoid a claim against the tax assessment every year to the Arbitral Court.

Before this decision, the only possibility had been to claim against each tax assessment one year at a time. With this decision, it is possible to claim directly to the Court against the NHR rejection.

Regarding the above, there is a new window of opportunity for all those whose NHR applications have been rejected.

Should you wish to further discuss this matter, don't hesitate to contact us. Our team is dedicated to providing comprehensive support to navigate these legal waters with the utmost diligence and precision.