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Relocating to Portugal has become an increasingly popular choice for expats from around the world—thanks to its affordable cost of living, high quality of life, stunning coastline, and welcoming communities.
In this guide, we’ll walk you through everything you need to know about relocating to Portugal from a personal tax perspective, including tax residency, income tax, special tax regimes and tax return obligations.
GTC recommend that you organize your affairs in good time to get ahead and make the most of favorable tax treatment while making sure you’re meeting your tax return obligations.
if you spend more than 183 days in Portugal during any 12 month period.
if you are a citizen of Hungary unless you have no permanent home in Hungary during the tax year.
if you are a Spain national who relocated to a tax haven less than five years ago.
if your ties are located in Mexico and 50% of your income arising in Mexico during the tax year.
if you maintain a residence in Portugal that you are present in on one day during the tax year.
if you are an EEA citizen and you are present in Hungary on more than 182 days during the tax year.
if you spend more than 183 days in Portugal during any 12 month period.
if you are registered with the Italian resident population.
if you are a citizen of Hungary unless you have no permanent home in Hungary during the tax year.
if you are a Spain national who relocated to a tax haven less than five years ago.
if you maintain a residence in Portugal that you are present in on one day during the tax year.
if you are an EEA citizen and you are present in Hungary on more than 182 days during the tax year.
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Providing that you satisfy the IFICI job criteria, your employment income will be subject to a flat 20% tax rate and your foreign income will be exempt from Portuguese taxation. You can use the scheme for 10 years.
* Portugal can be a very tax efficient place to live in and as such, Global Tax Consulting recommends seeking personalized tax planning advice to take advantage of the special tax regime.
If you receive incomes overseas while you are living in Portugal, you may find the source country, as a starting point, continues to tax the income which may cause double taxation unless you are using special tax regime.
Double taxation agreements can be used to mitigate double taxation and receive tax free income. As such, the more double taxation agreements a country has, the better, as agreements will ensure you’re not taxed twice and even better, ensure your income is tax free.
At present, Portugal has 80 double taxation agreements signed.
