Residency Services

Foreign investors in Portugal, from non-EU countries, may be eligible for a special visa, enabling them and their immediate family to work or study legally in the country and to travel within the Schengen area, provided that certain minimum amounts are invested.

The investment must be maintained for a minimum period of 5 years. After this initial period, the investor may immediately apply for a permanent residency permit.

The investment can currently be made in different manners:

• Capital transfer with a minimum value of 1.000.000 (one million) Euro (e.g. bank deposit, acquisition of financial assets);
• The acquisition of real estate for a minimum amount of €500.000 (five hundred thousand Euros);
• The purchase of real estate, with construction dating back more than 30 years or located in urban regeneration areas, for refurbishing, for a total value equal to or above €350.000 (three hundred and fifty thousand Euros);
• Creation of, at least, 10 jobs;
• The investment of a minimum €350.000 (three hundred and fifty thousand Euros) in research activities conducted by public or private scientific research institutions involved in the national scientific or technologic system;
• Capital transfer with a value equal to or above €250.000 (two hundred and fifty thousand Euros) for investing in artistic output or supporting the arts, for reconstruction or refurbishment of the national heritage, through the local and central authorities, public institutions, public corporate sector, public foundations, private foundations of public interest, networked local authorities, local corporate sector organizations, local associations, and public cultural associations, pursuing activities of artistic output, and reconstruction or maintenance of the national heritage;
• Capital transfer with a value equal to or above €350.000 (three hundred and fifty thousand Euros), for purchasing shares in investment funds or in venture capital geared to capitalize small and medium companies, constituted under the Portuguese law, with a 5 years maturity plan and at least 60% of investments made in Portuguese companies;
• Capital transfer with a value equal to or above €350.000 (three hundred and fifty thousand Euros), destined towards the incorporation of a Portuguese commercial Company, combined with the engagement of at least 5 permanent employees or to increase the share capital of an already incorporated Portuguese Company, with the engagement or maintenance of a minimum of five permanent employees, for a minimum period of three years.
• The Golden Visa, when issued, will be valid for an initial period of one year and then should be renewed for subsequent periods of two years. After five years, the investor will be entitled to obtain Portuguese permanent residency and after six, full Portuguese citizenship. When renewing the Visa, the individual should prove that he has remained in Portuguese territory for the required minimum periods: 7 days, in the first year; and 14 days in subsequent two year periods.

Non-habitual Residency

Portugal has also implemented a special regime for non-habitual tax resident individuals, which is intended to attract to Portugal certain qualified individuals and investments.

This special tax regime is applicable to individuals (EU or non-EU residents) who have not been considered and taxed as tax residents in Portugal in any of the previous 5 years, but during that period have paid tax in a foreign country.

In order to be considered tax resident in Portugal, one must either stay in the country for 183 days or more/year or hold permanent habitation premises on December 31 of a said year. After being recognized as a Non-Habitual Resident one is entitled to be taxed in this capacity for a period of 10 (ten) consecutive years.

Basically, under the Non-Habitual Residency program, an individual can be taxed on Portuguese sourced income obtained from High Value-Added activities (as per list officially published) at a flat tax rate of 20%. Foreign source income may generally be exempt from taxation in Portugal if it may be taxed abroad when related to many sources of foreign income including passive income such as interest, dividends, other investment income, rental income, and capital gains, as well as self-employment income from high value-added activities and royalties. Pension income will be subject to a 10% flat tax, as long as the income is not considered as having been obtained in Portugal. This flat rate is also applied to lump-sum payments derived from life-insurance policies, pension funds and pension-savings plans.

In effect, the NHR regime is closely linked with the double tax treaties signed by Portugal. In effect, most of the 79 double tax treaties signed by Portugal grant the possibility to tax most categories of income to the country of source. However, aiming to attract foreign investment, many countries will have rules in place to not tax non-residents. Since most such categories will not be taxed in Portugal in the hands of an NHR because they may be taxed abroad, this means that in practice most foreign-source income referred above will be zero taxed.

The Non-Habitual Residency application can be fairly straightforward, but a preliminary analysis should first be made to see the precise implications of the non-habitual tax residency on the types of income an applicant will receive. Once the status has been obtained, assistance will need to be provided to the client when submitting his/her annual tax return.

“Regressar” The Return Tax Programme

Aiming to promote the return of Portuguese citizens who emigrated from Portugal before the end of December 2015, during the financial crisis, Portugal has implemented a program that excludes 50% of employment or self-employment income from taxation for a five year period.

To apply for this program, the applicant must comply with certain conditions:

• have been resident in Portugal before the 31.12.2015;
• have not been resident in Portugal during the previous 3 years;
• not have any debts towards the Portuguese tax authorities.
• Applications can be made in 2019 and 2020.

More recently, Portugal has also established other specialized types of Visa, namely the “Start-Up Visa” and “Tech Visa”, with the aim of providing a residence visa for non-EU-Schengen start-up founders who want to establish their businesses and to reside in Portugal and ensuring that highly qualified staff, especially from the technological area from outside the European Union, can access jobs created by Portuguese companies in a simplified way.