Portugal has rapidly become a leading destination for discerning United States citizens seeking to enhance their lifestyles, optimize their tax situations, and establish a strategic presence within Europe.

Portugal offers a compelling combination of political and economic stability, a high quality of life, and membership in the European Union, making it an attractive proposition for those looking beyond traditional destinations.

This document details the various immigration pathways available, including the

• The popular D7 Passive Income Visa;
• The dynamic D8 Digital Nomad Visa; and
• The highly flexible Golden Visa Program.

By providing a thorough overview of each option’s legal frameworks, financial considerations, and long-term strategic advantages, it aims to equip US HNWIs and expats with the knowledge necessary to make informed decisions about their future in Portugal.

• Capital: Lisboa
• Area: 93.240 km²
• Exclusive Economic Zone: 1,727,408 km²
• Population: Approximately 10.6 mi
• GDP: Aproximately US$362.3 bi
• Currency: Euro (EURO)
• Time zone: GMT
• Government: Parliamentary democracy
• Official languages: Portuguese and Mirandese
• English proficiency: High
• Global Peace Index: 7th place

The case for Portugal

Portugal consistently ranks as one of the safest countries in the world, providing a secure environment for individuals and families alike. Notably, the Global Peace Index 2024 positions Portugal as the 7th safest country globally.

The high ranking is attributed to the country’s low crime rates and commitment to political neutrality.  Furthermore, Portugal demonstrates high levels of perception of safety across various domains, including health, violence, workplace security, personal security, and environmental security.

Portugal is not only a desirable tourist destination but also an increasingly popular choice for expatriates seeking a peaceful and stable base in Europe. The consistent recognition of Portugal as a safe haven underscores its appeal to those prioritizing security in their relocation and investment decisions.

Beyond safety, Portugal boasts a high quality of life, frequently appearing in global rankings that assess various factors contributing to overall well-being, such as warm climate, the friendliness of its people, the affordability of living compared to many other Western European nations and the United States, and the quality of its healthcare system.

This combination of factors makes Portugal an exceptionally attractive destination for individuals seeking an enriching and comfortable life in Europe.

Strategic location

Portugal’s membership in the European Union provides its residents with the significant advantage of visa-free travel across the Schengen Zone. This access to 26 other European countries facilitates ease of movement for business, leisure, and family connections.

Moreover, Portugal’s geographical location offers convenient time zone compatibility with the United States’ East Coast and major financial centers, simplifying communication and business operations for those with ongoing interests in the Americas.

The country is also readily accessible from the U.S., with numerous direct flights from major American cities, making travel between the two continents straightforward and convenient. This ease of access is particularly beneficial for US citizens who may need to travel frequently for business or to maintain ties in the United States.

Welcoming investment environment

Stable democratic institutions and a tradition of political neutrality characterize Portugal’s political landscape. The country has a strong record of peaceful and regular transitions of power between political parties.

This stability provides a reliable foundation for long-term investment and residency. Furthermore, Portugal’s economy demonstrates resilience and growth, with forecasts for real GDP growth in 2025 hovering around 2%.

The positive economic outlook and a stable political environment create a welcoming atmosphere for foreign investment and individuals seeking a secure European base.

Cost of Living Advantages

One of Portugal’s significant attractions is its relatively low cost of living, especially compared to major global financial hubs such as New York and London.

Data indicates that Lisbon, Portugal’s capital, is considerably more affordable than New York City, with the cost of living being around 40-50% lower. Similarly, Lisbon offers a more budget-friendly lifestyle compared to London, with overall costs estimated to be 30-40% lower. Even compared to Paris, Lisbon maintains a cost advantage, approximately 25-40% less expensive.

The affordability extends to property prices, with rental and purchase costs in Lisbon significantly lower than in major US metropolitan areas. While HNWIs may not be primarily concerned with basic living expenses, Portugal’s substantial savings can contribute to a higher quality of life and greater investment flexibility.

Healthcare and Education Systems: Access and Quality

Residents of Portugal gain access to a well-regarded public healthcare system known as the Serviço Nacional de Saúde (SNS). It provides comprehensive healthcare services, ensuring residents can access necessary medical care. Portugal’s healthcare system is consistently ranked highly on international indices, including a 12th place ranking by the World Health Organization.

For families with children, Portugal offers a range of educational options, including public schools and several international schools, particularly in larger cities. These international schools often provide curricula in English and other languages, catering to the needs of expatriate families from multiple backgrounds.

The quality of both the healthcare and education systems in Portugal offers significant benefits for individuals and families considering making the country their home.

In an era marked by increasing global uncertainties, including political instability, economic volatility, and unforeseen global events, having a reliable backup plan has become a paramount consideration for HNWIs. Just as insurance provides a safety net for physical assets, a second residency or passport offers invaluable security for personal freedom and mobility.

Portugal presents an exceptional platform for establishing such a backup plan for U.S. citizens. Its consistent ranking as one of the safest countries in the world provides a secure environment, while its membership in the European Union offers a gateway to enhanced global mobility.

The Golden Visa program serves as an ideal “Plan B” by providing a legal pathway to residency with minimal physical presence requirements, allowing individuals to secure EU access and a route to citizenship without needing to relocate permanently or become tax residents in Portugal.

This strategic advantage offers peace of mind and a tangible safeguard in an unpredictable world.

Accessing the European Union

Obtaining residency in Portugal, whether through the D7, D8, or Golden Visa programs, provides U.S. citizens with significant access to the European Union. Residency grants the right to visa-free travel within the Schengen Area, encompassing 26 European countries, facilitating seamless movement for business and leisure. Furthermore, residents have the right to live, work, and study in Portugal.

For those who pursue citizenship after the required residency period, a Portuguese passport opens doors to even greater opportunities, including the right to live, work, and study in any of the 27 EU member states.

This access to the EU’s vast market and diverse cultures represents a significant advantage for both personal and professional pursuits. Additionally, residents and citizens can access the high-quality healthcare and education systems available across the European Union.

Comparing regimes

Long-Term Planning: Securing Your Future and Legacy in Portugal

Portugal offers a stable legal and political environment conducive to long-term residency and planning. The country’s high quality of life ensures a comfortable and enriching environment for individuals and families, providing a solid foundation for future generations. Moreover, Portugal’s inheritance tax system is particularly favorable for direct family members, with no inheritance tax levied on spouses, descendants, or ascendants.

The combination of stability, quality of life, investment potential, and favorable inheritance laws makes Portugal an attractive destination for US citizens looking to secure their future and build a lasting legacy in Europe.

Comparing the D7, D8, and Golden Visa for Strategic Goals

Portugal offers a suite of residency options tailored to different needs and strategic objectives. The D7 visa is ideally suited for retirees and individuals with substantial passive income who are looking to make Portugal their primary residence. It requires a commitment to reside in Portugal for a significant portion of the year and offers a direct pathway to permanent residency and citizenship.

The D8 visa, on the other hand, is best for digital nomads and remote professionals who wish to live in Portugal while maintaining their employment or business activities abroad. It offers flexibility for location-independent people and provides a route to long-term residency and citizenship.

The Golden Visa program stands out as the most flexible option, primarily catering to individuals seeking an investment-based route to residency and a backup plan. With minimal stay requirements, the Golden Visa is ideal for those who wish to secure EU residency and a path to citizenship without needing to relocate permanently or become tax residents in Portugal. The choice among these options ultimately depends on the individual’s specific circumstances, financial situation, and long-term goals.

The Ultimate “Plan B” for U.S. Citizens

A robust backup plan has become essential for HNWIs in an increasingly complex and uncertain global landscape. Much like insurance protects tangible assets, a second residency or passport safeguards one’s freedom of movement and personal security. For U.S. citizens navigating political shifts, tax policy changes, or economic instability, the ability to relocate swiftly and legally represents a critical advantage.

Portugal’s Golden Visa program offers an ideal “Plan B” by providing legal residency, a clear path to EU citizenship, and a minimal physical presence requirement. This allows individuals to secure a valuable asset—EU access and a path to a powerful passport—without needing to significantly disrupt their lives in the U.S. or become tax residents in Portugal.  Furthermore, Portugal offers favorable tax treatment under certain conditions (as discussed in the next section) and a high quality of life, world-class healthcare, and access to the Schengen Area.

The program’s flexibility, combined with Portugal’s stability and strategic location within Europe, makes it a compelling option for US HNWIs seeking peace of mind and enhanced global mobility.

Investment Options

As of 2025, the qualifying investment options for the Portuguese Golden Visa program include:

• Investment in Venture Capital or Private Equity Funds: A minimum investment of €500,000 in eligible funds that are not directly or indirectly invested in real estate. These funds must be registered with the Portuguese Securities Market Commission (CMVM) and invest at least 60% of their capital in Portuguese companies with a minimum maturity of five years.
• Company Incorporation or Capitalization: An investment of €500,000 or more for the incorporation of a new commercial company in Portugal or to increase the share capital of an existing Portuguese company, combined with the creation of at least five new permanent jobs or the maintenance of at least ten jobs, with at least five being permanent.
• Investment in Cultural or Heritage Support*: A capital transfer of €250,000 or more for investment in or support of artistic production, or the recovery or maintenance of national cultural heritage, through accredited institutions certified by the Ministry of Culture.
• Investment in Scientific Research*: A capital transfer of €500,000 or more for investment in research activities conducted by public or private scientific research institutions involved in the national scientific or technological system.
• Creation of Jobs*: Creating at least ten new full-time jobs in a Portuguese company.

*This investment threshold can also be reduced by 20% if the investment is made in a low-density territory.

Due Diligence of Funds

Conducting thorough due diligence is paramount for US HNWIs considering the investment fund route under the Golden Visa program. Investors should carefully evaluate the fund managers and their track record, scrutinizing their experience, total assets under management (excluding Golden Visa funds), and the percentage of capital from institutional investors versus Golden Visa investors.

Understanding the fund’s economics, including all fees involved (subscription, management, performance), target returns, and the alignment of interests between the fund managers and investors (e.g., personal investment by the management team), is crucial.

A deep dive into the fund’s investment strategy, target sectors, typical investment size and stage, deal sourcing process, and value-added beyond capital is essential.

Investors should also assess the fund’s performance and risk management strategies, including expected holding periods, past performance (both best and worst investments), downside protection mechanisms, and strategies for managing underperforming companies and market downturns. The fund’s structure and operations should also be examined, such as the investment team’s capacity, reporting frequency to investors, and communication protocols during unforeseen circumstances.

Finally, understanding the fund’s exit strategy and liquidity options for investors after the mandatory five-year holding period for the Golden Visa is vital.

It is essential to verify that the fund is regulated by the Portuguese Securities Market Commission (CMVM), that it is fully eligible for the Golden Visa according to AIMA, and that it complies with all relevant regulations, including anti-money laundering (AML) and Know Your Client (KYC) procedures. Investors should also be aware of the typical minimum lock-up periods for these funds, ranging from five to ten years.

Engaging with experienced fund managers who welcome thorough due diligence and provide transparent responses is a positive indicator.

Minimum Stay Requirements

One of the most appealing aspects of the Golden Visa program for U.S. citizens seeking a backup plan is its minimal physical presence requirement.

Golden Visa holders must spend seven days in the first year and 14 days every two years in Portugal.

The low residency obligation allows investors to maintain their primary residence and lifestyle in the U.S. while securing residency in Europe.

Furthermore, after five years of holding the Golden Visa, investors become eligible to apply for Portuguese citizenship, provided they meet other requirements such as demonstrating a basic proficiency in the Portuguese language (A2 level), effective connection to Portugal, and having a clean criminal record.

Importantly, holding a Golden Visa does not automatically make a U.S. citizen a tax resident in Portugal, especially with such minimal stay requirements. It is a significant advantage for those primarily seeking a second passport or residency without altering their tax obligations.

Tax considerations for U.S. Citizens

U.S. citizens residing in Portugal should be mindful of the tax implications in both the United States and Portugal. Understanding the Double Taxation Agreement between the U.S. and Portugal is crucial to avoid being taxed twice on the same income.

While Portugal taxes its residents on their worldwide income, the U.S. also requires its citizens to report their global income, regardless of where they reside. Therefore, U.S. citizens living in Portugal may need to file tax returns in both countries and should explore mechanisms such as the Foreign Earned Income Exclusion (FEIE) and the Foreign Tax Credit (FTC) in the U.S. to mitigate double taxation.

It is highly recommended that US citizens considering residency in Portugal consult with our tax professionals with expertise in both U.S. and Portuguese tax laws to ensure compliance and optimize their tax situation.

GFDL Advogados is an independent law firm based in Lisbon, offering a comprehensive suite of legal services tailored to the sophisticated needs of its clients. Our team comprises seasoned advisors and lawyers with extensive international experience in law and global business affairs.

We offer discerning clientele strategic counsel on a wide array of matters, ensuring a nuanced understanding of cross-border transactions and investments within the Portuguese legal landscape.

Our firm is experienced in assisting US citizens and companies regarding Portuguese law in an international context. Our team members are fully fluent in English and are knowledgeable of US law and can assist you and your family in investing or moving to Portugal.

Our dedicated Immigration team and Private Client teams are ready to assist you. Contact us to schedule a consultation. 

Disclaimer

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