Thinking of becoming a digital nomad in Portugal? From affordable living to stunning beaches and a thriving digital scene, this ultimate guide covers everything you need to know about making Portugal your next digital nomad destination.
Portugal is a prime European destination for expats, especially those that work remotely as digital nomads. This country was an early entrant to the digital nomad visa (DNV) group of countries, and quickly gained appeal among remote workers.
Other top countries in Europe that’s popular amongst remote workers include Spain, Croatia, Malta, Cyprus and Italy. These and others all have digital nomad visas, but Portugal continues to be an attraction for many reasons.
Table of contents
- How to be a Digital Nomad in Portugal
- Digital Nomad Visa Portugal: What You Need to Know
- Living in Portugal as a Digital Nomad
- How can Contractor Taxation help Portugal digital nomads?
- Our Digital Nomads’ Popular Questions
- Related readings about Portugal and Contracting
In another article we shared the process of Anna and Beatrice from Canada, as they were deciding between Portugal and Croatia as their digital nomad destination. They concluded, as many have, that Portugal was their top choice to work and live.
But what are the next steps as they prepare for their adventure as Portugal digital nomads? What will be the requirements to be in full compliance?
How to be a Digital Nomad in Portugal
Although the nomadic lifestyle seems to be laid back compared to traditional work, the requirements take some time. Portugal has its own set of rules to qualify for the DNVs, ensuring that it is not misused.
Here is the checklist that Anna and Beatrice came up with to complete:
- Have an established network of remote clients: In other words, you can’t show up in Portugal and start your remote career from scratch.
- Verify your earnings for the past 3 months: To prove that you have current income from remote clients. You might have to show bank statements.
- Secure accommodation for one year: This is a hurdle from outside the country, but you can enter on a tourist visa and find accommodation while your DNV is pending.
- Open a Portuguese bank account
- Criminal background check and EU health insurance
- Approved Portugal Digital Nomad Visa application
Digital Nomad Visa Portugal: What You Need to Know
Portugal digital nomads have a few different visa types to choose from, but only one is a true DNV that was introduced in late 2022..
Portugal Digital Nomad Visa Requirements
Portugal has a very strong pro-immigration policy and its digital nomad visa reflects that fact. Although its requirements are similar to other DNVs, it can lead to residency after the initial five year validity period.
Portugal remote workers require a minimum income of EUR 3000 monthly, with proof of income the previous three months. The income requirements are in place to show that you are an active remote worker. You also need to show EUR 9000 in savings to support yourself for the year.
There are two types of DNVs, a short stay which is valid up to one year, or a residency DNV which can be valid for up to five years. The short stay DNV can be renewed for an additional 12 months.
The second type of DNV is valid for an initial two years, renewable for another three years. It can lead to permanent residency if desired. This is fairly unique for DNVs which usually don’t have a residency option. The long stay DNV can be extended indefinitely, and after five years you are eligible for permanent residency.
Is it possible to extend the Portugal Digital Nomad Visa?
Yes, both DNVs can be extended. Once you reach the total 24 month limit for the short stay DNV you have to leave the country. Then you can apply for the long stay DNV or another visa.
Other Visa Options
Prior to the introduction of the Portugal DNV, many nomads were able to qualify for other visa types.
D7 Passive Income Visa
For a while this visa was available for digital nomads, but is now restricted to expats with passive income only.
D2 Entrepreneur Visa
If you start a company in Portugal you can avail of the D2 Entrepreneur visa. There is no minimum capital requirement so it’s relatively easy. The initial visa is valid for four months, then you apply for a residence permit which is good for two years.
Living in Portugal as a Digital Nomad
So why exactly is Portugal so popular among digital nomads? How does it compare to Spain which is also popular with digital nomads? Where do digital nomads live in Portugal?
Both Spain and Portugal offer beach options, but many younger digital nomads are looking for more excitement than simple resort life. However, one can find a dedicated Portugal digital nomad village on the island of Madeira off the coast of Africa. But, if you prefer city life, Portugal has that to offer as well.
One expat asked: Which city in Spain or Portugal for a digital nomad in his late 20s? I’m from NYC and I love the busy nightlife, the cultural offerings and the big city but hate the humidity and cold.
Portugal is not as glamorous as Spain and the cities are smaller, but it has plenty to offer in terms of city life. The two main cities are Lisbon and Porto and each offer a different ambience. Porto is more mainstream with many contemporary features, but Lisbon is the hotspot for digital nomads. If you are looking for fun nightlife and a younger expat crowd, Lisbon is for you.
How can Contractor Taxation help Portugal digital nomads?
Not every remote worker will choose a digital nomad visa, as there are limitations. For example, you cannot work for local clients under a DNV. It is not difficult to imagine that a skilled remote worker could find local clients through networking and socialising.
So how can you serve those clients if a DNV does not permit it?
This is where an umbrella company can prove invaluable, either initially or after some time in the country. The umbrella company acts as an intermediary between you and your clients, handling all payments and tax withholding. They can sponsor traditional work permits and are a valid, legal entity within the country, so that you can work for local clients as well.
Other benefits of umbrella companies include:
- Manages all client payments, tax withholding and any social contributions
- Issues you a payslip each month, to a local or foreign account
- Sponsors work permits
- Helps set up the contract with the client
- Moderates any disputes with your client
- Advises on access to totalization and double taxation treaties
If you have questions about how an umbrella company can help you as an international contractor, please contact us at Contractor Taxation.
Our Digital Nomads’ Popular Questions
Adaptation to culture and language can be difficult, as well as being away from friends and family. There are also many new details to attend to, such as visa applications, bank accounts, finding stable internet and personal security.
For many, it is the desire to work and live in a foreign culture, without sacrificing their professional career. Also, some digital nomad destinations are very affordable, allowing expats to live a better lifestyle than in their home country.
This may have been the case as recently as five years ago, but since then over 50 countries have introduced digital nomad visas. This allowed remote workers to become compliant and not rely on short term tourist visas. The DNV policy by these countries is designed to boost revenue from digital nomads working online.
The influx of expats of all types is affecting Portugal in several ways. Because of Portugal’s friendly residency programs and tax policies it has attracted foreigners to its cities and beaches for some time. These expats have money to spend in their new home.
As a result, there are reports that prices for renting or buying accommodations have risen in some locations. But it can’t be attributed solely to digital nomads, since the DNV is relatively new, and retirees have been moving to Portugal for years.