The Portuguese golden visa (residence-by-investment) program underwent significant changes in October 2023. Since that time, it has become impossible to acquire legal residence in Portugal by investing into real property in the country. Previously, it was the most popular route to Portuguese residence but it is unavailable any longer.
Why does Portugal attract foreigners who are ready to invest considerable amounts of money to obtain golden visas that serve as legal residence permits? Let us find out about that.
Portugal is a country that combines picturesque views with rich history and culture, a mild climate, and friendly people. It attracts tourists by unique places of interest and those who relocate there for good find a European lifestyle that comes at a comparatively low cost.
Main attractions of Portugal
Portugal is known for its unforgettable natural beauty and historic places:
- Lisbon: The capital of the country attracts tourists by its narrow streets, old trams, and breathtaking views.
- Porto: An ancient city famous for its wine cellars and beautiful bridges.
- Algarve: A resort region of Portugal with fantastic beaches, cliffs, and marine caves.
- Sintra: A city from a fairytale with magnificent castles and fortresses surrounded by thick woods.
Lifestyle and culture
Life is calm and relaxed in Portugal:
- Lifestyle: The Portuguese share family values, they spend time with friends, and enjoy life. They often dine outside and they love loud celebrations.
- Cuisine: Portuguese cuisine is famous for its seafood dishes and deserts. Many people appreciate Portuguese wines too.
- Festivals: The Portuguese love holding festivals on any sort of occasion. The most popular festivals take place in Madeira and Porto.
Security and healthcare
- Personal security: Portugal has been at the top of the ratings for personal security for years. This is an important factor that attracts tourists and immigrants.
- Healthcare: Portugal offers high quality medical services to all citizens and legal residents.
Climate
- A mild climate: Thanks to its geographical position, most of Portugal has temperate maritime climate with warm dry summers and mild moist winters.
- Sunny days: Portugal competes with Greece for the number of sunny days per year. If you love the sun and the sea, you will love Portugal too.
How can you relocate to Portugal?
Now let us see what you have to do to acquire legal residence in Portugal. Golden visas are still available to foreign investors and one of their important advantages is that the holders have to spend only two weeks in Portugal every two years to maintain their visas.
So, what changes were introduced to the golden visa program in 2023?
Before October 2023:
- You could buy real property to qualify for a golden visa.
- You could invest 350,000 EUR in research or in a venture fund to qualify for a golden visa.
- You could put a million euros in a Portuguese bank to qualify for a visa
Since October 2023:
- It has become impossible to qualify for a golden visa by purchasing real property in Portugal. It does not mean that foreigners cannot buy property in the country: they can and some pretty nice villas are for sale there. The only thing is that owning real property in Portugal does not make you eligible to apply for a golden visa any longer.
- You can put 500,000 EUR into a research project or an investment fund to qualify for a golden visa.
- You can donate 250,000 EUR to qualify for a visa.
- You can open a company (or invest in an existing company) contributing 500,000 EUR and creating 10 new jobs in Portugal to qualify for a golden visa.
Things that remain unchanged:
- It is possible to file a family application for a golden visa adding your underage (or financially dependent) children and parents above 55.
- After holding a golden visa for 5 years, you can apply for citizenship of Portugal. When you obtain a Portuguese passport, you can withdraw from investments.
Please note that you will have to take a test in the Portuguese language to become a citizen of the country even though the required level is A2, which is just basic.
Applications for golden visas are sometimes processed rather slowly (for up to 2 years). For this reason, the Portuguese authorities have decided to count down the 5-year period from the date of filing the application. Previously, the countdown started on the date when the visa was issued.
- You have to be able to confirm the legality of your investment capital.
- You don’t have to permanently live in Portugal to keep the golden visa: spending 14 days there every 2 years is enough.
- You have to have no criminal past.
Advantages of a golden visa to Portugal
- A golden visa holder becomes a legal resident of Portugal, which means that he/ she can live, work, and study there.
- A Portuguese residence card gives visa-free access to all EU countries.
- You can live in another country while holding a Portuguese golden visa. Stay in Portugal for a week every year and you’ll be safe.
- No language tests are required to obtain a golden visa.
Until 2024, a special tax regime was available to highly qualified foreign specialist in Portugal (NHR, Non-Habitual Resident). This regime offered serious fiscal benefits: the tax rates were reduced and non-habitual residents were exempted from some taxes for 10 years. Since January 1, 2024, the NHR program has been unavailable to new residents even though the people who obtained the status in previous years can still enjoy it for 10 years.
If you choose to relocate to Portugal and become a tax resident of the country, you will have to pay the personal income tax at a progressive scale. The tax is going to be between 18% and 47% depending on the amount of your annual income. If you are not a tax resident of Portugal, you will be taxed only on the income that you make in Portugal. You will automatically become a tax resident of the country if you spend more than 183 days per year there so you will have to pay taxes in Portugal in this case. At the same time, Portugal has made numerous bilateral agreements on avoiding double taxation.
Conclusion
Golden visas to Portugal are still available even though the option to invest in real estate in the country is gone. Portugal is attractive for foreigners because establishing legal residence there allows doing business in Europe and living in a country with a warm climate, beautiful landscapes, and a relaxed lifestyle. In view of the fact that the golden visa program conditions have changed, you will be well-advised to consult a professional if you would like to become a legal resident of Portugal by investment.
