Living in Portugal
With personalised financial advice from Blevins Franks, you can make the most of what you have while keeping up with the complex tax rules in both Portugal and the UK.
How you’re taxed in Portugal
Once you’re resident in Portugal, you could potentially pay:
Even if you’re not resident, you could be liable for Portuguese taxes, for example, if you own, or sell property in Portugal.
In our experience, many UK nationals can save money in tax by moving to Portugal and our clients enjoy extremely favourable tax treatment on their investments and assets.
See more about tax planning
Tax-free opportunities for new residents
Portugal’s ‘non-habitual resident’ (NHR) scheme gives special tax benefits to new residents for their first ten years in the country. It also offers a lower income tax rate of 20% if you’re employed in Portugal in a ‘high value’ activity and allows you to receive foreign income – like pensions – tax-free. You could also pay no Portuguese tax on gains you make from UK property.
Even if you do not qualify for non-habitual residence, Portugal offers some very attractive tax benefits for UK expatriates.
Estate planning and inheritance tax
The Portuguese equivalent of inheritance tax is stamp duty and is only payable on assets located in Portugal. The rate is 10% for everyone, apart from direct family and spouses who’ll pay no tax at all on inheritances.
Many British expatriates in Portugal may not be aware that they could also face UK inheritance tax, which is determined by domicile rather than residence.
Portugal’s succession law imposes forced heirship. This means that your direct family could automatically inherit a pre-defined proportion of your estate, regardless of whether that's your intention. However, there are ways to override this rule.
Our advisers can present legitimate options to ensure your estate is distributed according to your exact wishes while protecting your heirs from paying more tax than necessary.
See more about estate planning
Expatriates resident in Portugal can enjoy significant tax benefits on UK pension income.
Through the UK/Portugal tax agreement, most UK pensions are taxable only in Portugal. For non-habitual residents (NHR), this can mean tax-free pension income for their first ten years in the country. For others, British pensions are taxable at the Portuguese income tax rates up to 48%, although it’s possible to receive up to 85% tax-free under certain conditions.
Many expatriates prefer to transfer their UK pension to a Qualifying Recognised Overseas Pension Scheme (QROPS) to unlock tax-compliant opportunities in Portugal.
Blevins Franks can advise you on the pros and cons of all your pension options as well as the local tax implications, so you can make a fully informed decision on the best solution for you.
See more about pensions
Investment advice tailored for you
Our specialist expertise can make sure your finances are structured as tax efficiently as possible with an investment strategy tailor-made for you.
We start with an objective assessment of your risk profile so that we can recommend portfolios designed around your personal situation and objectives. We have access to some of the world’s best investment managers to make sure your money works as hard as it can.
Speak to Blevins Franks to take full advantage of the tax and investment opportunities available to British expatriates living in Portugal.
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The tax rates, scope and reliefs may change. Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change. Tax information has been summarised; an individual is advised to seek personalised advice.