If you’re an American moving to Portugal, the first things you need to know are which visa you qualify for and how your US taxes will be affected. Portugal offers several visa types for Americans, including the D7 (passive income visa), Golden Visa, Digital Nomad Visa, and D2 (entrepreneur visa). At the same time, even after relocating, US citizens must continue to file annual US tax returns and comply with IRS rules on foreign income, assets, and bank accounts.
Visa Options for Americans Moving to Portugal
Portugal provides a variety of visas to fit different lifestyles and financial situations. Here are the most common visas for Americans:
D7 Visa (Retirement or Passive Income Visa)
- Best for: Retirees and individuals with passive income such as pensions, rental income, dividends, or savings.
- Key requirements: Applicants must show proof of stable income, usually at least €9,840 per year for the main applicant, with additional amounts required for dependents. You will also need to provide proof of accommodation in Portugal, valid health insurance, and a clean criminal record. The D7 Visa is renewable and can lead to permanent residency and even citizenship after five years.
- Advantages:
- Affordable option compared to other visas.
- Leads to permanent residency and eventually Portuguese citizenship.
- Popular choice for retirees moving to Portugal.
Digital Nomad Visa
- Best for: Remote workers and freelancers employed by companies outside Portugal or earning income abroad.
- Key requirements: Applicants must demonstrate an income at least four times the Portuguese minimum wage, which currently amounts to roughly €3,280 per month as of 2025. Proof of employment or freelance contracts with foreign clients is required. Like the D7 Visa, applicants must also show proof of housing in Portugal, health insurance, and a clean criminal record.
- Advantages:
- Specifically designed for the growing number of remote workers.
- Can be granted as a short-term visa (up to one year) or a residency visa (longer-term stay).
Golden Visa (Investment Visa)
- Best for: High-net-worth individuals willing to invest in Portugal.
- Key requirements: Applicants must make a qualifying investment, such as real estate, business creation, or cultural contributions. The minimum investment level depends on the chosen route but generally ranges from €250,000 to €500,000. In addition, applicants must spend at least seven days per year in Portugal and provide health insurance and background checks.
- Advantages:
- Offers a pathway to residency with limited physical presence requirements (only 7 days per year).
- Attractive for investors who don’t plan to live in Portugal full-time.
D2 Visa (Entrepreneur Visa)
- Best for: Entrepreneurs, small business owners, and freelancers who want to establish a business in Portugal.
- Key requirements: Applicants must present a viable business plan that demonstrates potential economic benefit to Portugal. Proof of sufficient funds to support the business and living expenses is also required. Supporting documents include a Portuguese tax number, a local bank account, and business registration once approved.
- Advantages:
- Encourages entrepreneurship in Portugal.
- Flexible for freelancers offering services from Portugal.
Student Visa
- Best for: Americans pursuing higher education in Portugal.
- Key requirements: You must show an official acceptance letter from a recognized Portuguese educational institution, proof of financial means to cover tuition and living expenses, and evidence of housing such as a rental contract or dorm placement. Health insurance that is valid in Portugal is also required. A clean FBI background check, a valid passport, the visa application form, and passport-sized photos must also be submitted. The visa is usually granted for one year and can be renewed if you remain enrolled.
- Advantages:
- Simple pathway for students.
- Can later transition to other visas or residency.
Residency and Citizenship Pathway for Americans
Once an American receives a visa, they typically transition into a residency permit. After five years of legal residency, they can apply for permanent residency or Portuguese citizenship, provided they meet language and integration requirements.
This makes moving to Portugal not just a temporary adventure but also a long-term opportunity for dual residency or even EU citizenship.
US Tax Implications When Moving to Portugal
While securing a visa is the first step, Americans moving to Portugal need to remember one critical rule: the US taxes its citizens on worldwide income, no matter where they live.
Filing Requirements for US Citizens in Portugal
- US Expat Tax Return (Form 1040): Every American must file annually if they meet the filing threshold.
- Foreign Earned Income Exclusion (FEIE): Allows exclusion of up to $126,500 (2024) of foreign earned income if you meet either the Physical Presence Test (330 days abroad in 12 months) or the Bona Fide Residence Test.
- Foreign Tax Credit (Form 1116): To offset Portuguese taxes paid against US tax liability.
- FBAR (FinCEN Form 114): If you hold over $10,000 in foreign bank accounts at any time during the year.
- FATCA (Form 8938): Additional reporting for higher asset thresholds.
Portugal Taxes for Expats
Americans moving to Portugal should understand how the local tax system works. In Portugal, residents are taxed on their worldwide income, while non-residents are only taxed on income sourced from within Portugal. The country applies progressive income tax rates that currently range from 14.5% to 48%, depending on earnings. In addition, if you are working in Portugal, social security contributions may also apply, which can further affect your overall tax obligations.
Double Taxation and the US–Portugal Tax Treaty
The US–Portugal tax treaty helps prevent double taxation. For example, if you pay Portuguese taxes on your income, you may be able to offset those taxes against your US liability using the Foreign Tax Credit.
10 Practical Steps for Americans Moving to Portugal
If you are considering moving to Portugal, it’s important to plan carefully. While Portugal offers an excellent quality of life, great weather, and relatively affordable living costs compared to the US, the process requires preparation. Below are the essential steps Americans should take before making the move:
1. Research and Choose the Right Visa
Americans can enter Portugal for up to 90 days visa-free as tourists. However, if you plan on staying longer, you’ll need to apply for the correct visa. Common options include:
- D7 Visa (Passive Income Visa): Popular with retirees and remote workers who can show proof of steady income from pensions, investments, or other passive sources.
- Golden Visa: For individuals making qualifying investments in Portugal, such as real estate or business investments.
- D2 Visa (Entrepreneur Visa): Designed for those who want to start or expand a business in Portugal.
- Digital Nomad Visa: A newer option for remote workers who earn income from outside Portugal.
Each visa comes with different requirements, so choosing the right one is critical before you move.
2. Prepare Your Documents in Advance
Before moving to Portugal, gather the documents required for your visa and eventual residency. These often include:
- Passport valid for at least six months.
- Proof of income or financial means.
- Health insurance coverage.
- FBI background check (apostilled).
- Proof of accommodation in Portugal (rental contract or property deed).
Preparing these documents while still in the US will make the transition smoother.
3. Open a Portuguese Bank Account and Obtain an NIF
An NIF (Número de Identificação Fiscal) is a taxpayer number required for almost all financial activities in Portugal, including renting property, opening a bank account, and paying taxes. Americans must apply for an NIF as one of their first steps after arrival.
Opening a Portuguese bank account is also important, as many visas require proof of funds deposited in a local account.
4. Secure Housing
Finding accommodation in Portugal can be competitive, especially in Lisbon, Porto, and the Algarve. Many Americans initially rent before committing to buying property. Websites like Idealista and OLX are popular for rentals.
If you’re applying for a visa, you’ll usually need a lease agreement to prove where you’ll be living.
5. Health Insurance and Healthcare
Private health insurance is usually required when applying for a visa. Once you become a legal resident, you can also access Portugal’s national healthcare system (SNS). Many expats combine both private and public coverage to ensure full access.
6. Learn Basic Portuguese
While many Portuguese speak English, especially in larger cities, learning Portuguese can make your life easier and help you integrate better into the community. It also helps with government processes, medical visits, and day-to-day interactions.
7. Understand Tax Implications (US and Portugal)
For Americans, moving to Portugal comes with tax obligations in both countries. You’ll need to:
- Continue filing your US tax return every year, regardless of where you live.
- Consider the Foreign Earned Income Exclusion (FEIE) or the Foreign Tax Credit (FTC) to avoid double taxation.
- Report any foreign bank accounts over certain thresholds with FBAR (FinCEN Form 114).
- Understand Portugal’s Non-Habitual Resident (NHR) regime, which may provide tax benefits for the first 10 years of residency.
Working with a US expat tax professional who understands both US and Portuguese tax rules is highly recommended.
8. Budget for Living Costs
While Portugal is generally more affordable than the US, costs can vary significantly depending on the region.
- Lisbon and Porto are more expensive but offer vibrant city life.
- The Algarve is popular for retirees but has seasonal fluctuations in pricing.
- Smaller towns and inland areas provide a much lower cost of living.
It’s wise to prepare a budget that factors in rent, utilities, groceries, transportation, and healthcare.
9. Plan the Move and Logistics
Decide whether you’ll ship your belongings or purchase furniture and appliances once in Portugal. Shipping can be costly, so many expats prefer to sell much of what they own in the U.S. and start fresh.
Don’t forget to update important records like mailing addresses, voter registration, and banking information before you leave.
10. Connect with the Expat Community
Portugal has a strong American expat presence, especially in Lisbon, Cascais, Porto, and the Algarve. Joining local expat groups online or in person can help you adjust, get recommendations, and build a support system as you settle in.
FAQs About Moving to Portugal as an American
1. Do Americans need a visa to live in Portugal?
Yes. While US citizens can enter Portugal for up to 90 days without a visa, staying longer requires a residence visa. Common options include the D7 Visa (for retirees or those with passive income) and the Digital Nomad Visa (for remote workers).
2. What is the D7 Visa for Americans moving to Portugal?
The D7 Visa is popular with retirees and those with stable passive income such as pensions, rental income, or dividends. It allows Americans to establish residency in Portugal while enjoying access to healthcare and other benefits.
3. Can Americans work in Portugal on a D7 Visa?
Yes, the D7 Visa permits work, though it is often applied for by those with passive income. Alternatively, the Digital Nomad Visa may be better suited for Americans working remotely for U.S. or foreign companies.
4. Do I still need to file US taxes if I move to Portugal?
Yes. As an American citizen, you must file a US expat tax return each year, regardless of where you live. However, you may be able to claim benefits like the Foreign Earned Income Exclusion, the Foreign Tax Credit, or rely on the US-Portugal tax treaty to help avoid double taxation.
5. How are taxes different for residents and non-residents in Portugal?
Residents are taxed on worldwide income, while non-residents only pay tax on Portugal-sourced income. Portugal’s progressive tax rates range from 14.5% to 48%. Social security contributions may also apply if you are employed or self-employed in Portugal.
6. What is the Non-Habitual Resident (NHR) regime in Portugal?
The NHR program offered favorable tax treatment for new residents, but it has been largely phased out for new applicants starting in 2024. However, some Americans moving to Portugal may still qualify under transitional rules.
7. How much money do I need to show for moving to Portugal?
For a D7 Visa, you must demonstrate sufficient funds to support yourself. Typically, this is based on the Portuguese minimum wage—about €9,840 annually for a single applicant, with additional amounts required for dependents.
8. Can I access healthcare in Portugal as an American expat?
Yes. Once you become a resident, you may access Portugal’s public healthcare system. Many expats also purchase private health insurance to supplement public care.
9. How long does it take to get residency in Portugal?
The process usually begins with applying for a visa in the U.S. Once approved, you receive a temporary residence permit in Portugal, which can later be renewed and eventually lead to permanent residency or citizenship.
10. Do I need to report Portuguese bank accounts to the IRS?
Yes. If the total value of your foreign bank accounts exceeds $10,000 at any time during the year, you must file an FBAR (Foreign Bank Account Report). You may also need to report under FATCA depending on account balances.
