Relocating to Portugal: NHR Tax Regime and D7 Visa

Portugal has become one of Europe's most sought-after relocation destinations over the past decade, attracting retirees, remote workers, investors, and families from across the UK, the US, and beyond. The country's combination of climate, culture, relative affordability, EU membership, and — until recently — a highly attractive tax regime made it a standout choice. As of 2026, the landscape has changed with reforms to the tax system, but Portugal remains an excellent destination. Understanding the current position is essential for making an informed decision.

Residency Options

D7 Visa (Passive Income Visa / Retirement Visa)

The D7 is Portugal's primary long-term residency visa for financially independent individuals who do not work in Portugal. It is available to non-EU nationals (including post-Brexit UK nationals) who can demonstrate sufficient regular income from passive sources: pension, rental income, investments, dividends, or remote employment income from overseas.

Income requirements (as of 2026): Approximately €920/month for the main applicant (roughly 100% of the Portuguese minimum wage, which rose to €920 for 2026), plus supplements for additional dependants (typically 50% for a spouse and 30% per dependent child). These figures are reviewed annually.

Process:

1. Apply at the Portuguese consulate in the UK (or your home country) with proof of income, clean criminal record certificate, proof of accommodation in Portugal (rental contract or property purchase), health insurance, and completed application forms
2. Receive a D7 visa (initial four months entry)
3. Travel to Portugal and apply for a residence permit at AIMA (the agency for immigration and asylum, which replaced SEF in 2023)
4. Receive a two-year residence permit, renewable for three years, then permanent residency or citizenship pathways

Citizenship: Portugal's citizenship pathway is relatively accessible — after five years of legal residence, applicants meeting language and other requirements can apply for Portuguese citizenship (and thus an EU passport). This is a significant long-term benefit for UK nationals post-Brexit.

D8 Visa (Digital Nomad / Remote Work Visa)

For remote workers employed by or providing services to non-Portuguese entities. Income requirement is similar to the D7. Allows legal long-term residence for those working remotely from Portugal. Launched in 2022 and well regarded for its relatively straightforward conditions.

Golden Visa

Portugal's Golden Visa (for investment-based residency) underwent significant changes in 2023: direct real estate investment was removed as a qualifying investment category. As of 2026, qualifying investments include fund investments, company capitalisations, scientific or artistic contributions, and other approved channels. Real estate no longer qualifies for new applications. Verify current qualifying categories — the programme has evolved and may continue to do so.

EU/EEA Citizens

EU and EEA nationals exercise freedom of movement and can register as residents in Portugal under the EU citizen framework. Registration at the local Câmara Municipal (town hall) and obtaining an NIF (Número de Identificação Fiscal) are the principal administrative steps.

NIF: Your Tax Identification Number

The NIF (Número de Identificação Fiscal) is Portugal's equivalent to the NIE in Spain — the tax and administrative number required for all formal transactions: opening a bank account, signing contracts, registering a car, engaging with public services, and paying taxes.

For non-residents and those without a Portuguese address yet, a fiscal representative in Portugal is required to obtain an NIF before establishing residency. This service is widely available and inexpensive.

The Tax Regime: NHR and IFICI

The Original NHR (Non-Habitual Resident) Regime

Portugal's Non-Habitual Resident (NHR) regime was introduced in 2009 and became one of the most attractive tax incentives in Europe. It provided 10 years of preferential tax treatment, including a flat 20% tax rate on qualifying Portuguese-source professional income and, critically, exemptions (or flat 10% rate) on certain foreign-source income — meaning UK pensions, rental income from overseas property, dividends, and interest could be taxed at low or zero rates in Portugal, with the standard DTA position preventing double taxation.

The NHR as originally structured was abolished for new applicants from 1 January 2024. Those who registered as NHR residents before that date retain their benefits for the remainder of their 10-year period.

IFICI (Incentive for Scientific Research and Innovation) — NHR 2.0

Portugal introduced a replacement regime, IFICI, from 2024. It is more targeted than the original NHR:

• Available to qualifying professionals in science, technology, engineering, mathematics (STEM), intellectual property, digital economy, and senior management in Portuguese companies
• Provides a flat 20% tax rate on qualifying Portuguese-source income for 10 years
• Some foreign-source income benefits, but narrower than original NHR

For retirees and passive-income expats: IFICI does not replicate the original NHR's benefits for pension income and passive income. Retirees moving to Portugal from 2024 onwards do not benefit from the same preferential treatment that attracted previous waves of expats.

The new environment means tax planning for a Portugal relocation requires careful analysis. Portugal's standard income tax system is progressive, with rates up to approximately 48%. Whether Portugal remains tax-advantaged for your specific income profile depends on the nature of your income and applicable DTAs.

Seek specific advice from a Portuguese-licensed tax adviser alongside your home-country adviser.

Banking in Portugal

Opening a Portuguese bank account as a non-resident is possible before you move — useful for paying deposits on accommodation. Options include:

Major Portuguese banks: Caixa Geral de Depósitos (state-owned), Millennium BCP, Novobanco, Santander Portugal, BPI. Most will open accounts for non-resident applicants with a NIF, passport, proof of address in your home country, and source of funds documentation.

International options: Activo Bank (digital), N26, Wise, and Revolut are used by expats for day-to-day banking. HSBC Expat can provide continuity for existing HSBC customers.

Cost of Living

Portugal's cost of living, while rising — particularly in Lisbon and Porto — remains materially lower than the UK:

Lisbon

• Rent (1-bed apartment, central Lisbon): €1,200–2,000/month
• Rent (2-bed apartment, central): €1,800–3,000/month
• Groceries (single person): €200–350/month
• Eating out: Very affordable by Western European standards; restaurant meal €12–25/person
• Transport: Excellent public transport (metro, trams, buses); monthly pass approximately €40

Porto

• Rent approximately 20–30% lower than Lisbon for comparable properties
• Smaller city, strong cultural life, excellent food, good international transport links

Algarve

• Property costs vary; Quinta do Lago, Vale do Lobo — premium pricing comparable to southern Spain's best areas. Inland Algarve and smaller coastal towns are significantly cheaper.
• Cost of living is generally lower than in Lisbon outside premium resort areas
• Smaller international community in terms of services, but well established British expat presence

Silver Coast (Óbidos, Caldas da Rainha area)

Popular with US expats and growing number of British families. Lower costs than Lisbon, good international school options developing.

Property

Portugal's property market has experienced strong price growth in Lisbon and Porto over the past decade. Foreign buyers can purchase property freely. Acquisition costs include IMT (Property Transfer Tax, 0–7.5% depending on value and use), stamp duty (0.8%), notary and registration fees, and legal fees. Total acquisition costs are typically 6–10% of purchase price.

Healthcare

EU citizens access the SNS (Serviço Nacional de Saúde) public health system through standard EU entitlements. Non-EU residents with legal residency can register with the SNS after establishing residency. Private health insurance is widely used as a supplement for faster access and specialist care; domestic private policies are available from Multicare, AdvanceCare, and others at affordable premiums.

Pre-Departure Checklist for Portugal

• Obtain NIF (through fiscal representative if not yet resident)
• Apply for D7 or D8 visa at Portuguese consulate
• Arrange health insurance meeting visa requirements
• Notify HMRC of departure; obtain UK tax residency assessment
• Consult Portuguese tax adviser on IFICI eligibility and income tax position
• Secure accommodation in Portugal (rental contract needed for visa application)
• Open Portuguese bank account (non-resident account possible before arrival)
• Maintain UK bank account for UK income and obligations
• Register at Câmara Municipal on arrival and apply for residence permit at AIMA

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This guide provides general information only. Portugal's visa requirements, tax regime, and residency rules have changed significantly in recent years and continue to evolve. The original NHR regime no longer applies to new applicants. Always seek current professional advice from qualified Portuguese and UK advisers. Information reflects the position as of 2026.

How Global Investments Can Help

Portugal is an increasingly important market for globally mobile clients and investors. Global Investments can connect you with specialist advisers covering Portuguese tax and IFICI planning, D7 visa applications, property acquisition, and the full financial setup of life in Portugal.

Contact our team to discuss your Portugal relocation.