Does IFICI cover pensions?

Retirees are the group the change hit hardest, and a lot of pages still blur it by saying IFICI exempts foreign income without naming the exception.

What the FAQ actually carves out

Under IFICI, foreign source income is exempt from IRS as a general rule. There are two exceptions: Category H pension income stays taxable, and income from blacklisted low tax jurisdictions is taxed at a flat 35 percent regardless of category. So a French, British or American pension paid to a Portuguese tax resident with IFICI is taxed the same way as for anyone else: aggregated with other income and run through the 2026 brackets, with the solidarity surcharge on taxable income above 80,000 euros.

Pension income does get the same specific deduction as salary, 4,587.09 euros for 2026 on our reading of Article 25 CIRS. That figure depends on the IAS for 2026, which we could not read on an official page, so treat it as the working number rather than a certainty.

What the old regime gave, for contrast

1. People who registered for NHR before April 2020 have foreign pensions fully exempt for their full ten years.
2. People who registered between April 2020 and January 2024 pay a 10 percent flat rate on foreign pensions for their full ten years.

Neither treatment exists for anyone becoming resident now. If a broker or a relocation agency tells you otherwise, ask which article they are reading.

What this means if you are choosing a country on pension income

IFICI is built around employment and self employment in listed activities, so a retiree with no qualifying work usually has nothing to claim in the first place. The variable worth modelling is not the regime, it is the treaty: some conventions give Portugal the exclusive right to tax a private pension, others leave it with the paying state.

The tax estimator runs pension income through the brackets so you can see the bill before you move, and how foreign pensions are taxed after NHR goes through the categories one by one. A cross border adviser should read your own treaty before you commit.