Your Guide to Portugal’s Digital Nomad Visa
Portugal’s sunny weather and laid-back culture have made it a popular destination for Americans living abroad. And if you make your living as a digital nomad, Portugal offers another enticing benefit: the D7 visa. This visa program makes it easier than ever for remote workers to enjoy the sunny beaches of Portugal.
Here’s what you need to know.
What Is a Digital Nomad Visa?
Digital nomad visas are travel visas that let you live in a country for a certain amount of time. Typically, this time span will be longer than a standard tourist visa would allow.
Digital nomad visas also give you the right to work remotely in your country of choice as long as you don’t enter the local labor market. (This allows you to earn an income without taking jobs from local workers.)
Most digital nomad visas require you to pay an application fee. You may also have to meet several qualifications, such as a minimum monthly income and a valid health insurance policy. Once approved, you can remain in the country until the visa expires.
What Is Portugal’s Digital Nomad Visa Program?
For now, Portugal doesn’t have a dedicated digital nomad visa program. However, Portugal’s D7 visa, also known as the Passive Income visa, is an excellent option for digital nomads hoping to bask in the beauty of the Iberian coast.
Like most digital nomad visas, Portugal’s D7 visa lets you live and work in Portugal as long as you aren’t employed by a Portuguese company. For digital nomads earning their income online from a non-Portuguese employer or client, the D7 visa is the perfect choice. (If you want to enter Portugal’s local job market, you must obtain a work permit.)
Once you receive a D7 visa, you can live in Portugal for a full year. Then, you will have the option to renew your visa for another four years. After five years, you can apply for permanent residence.
But there’s another benefit of the D7 visa that makes it so valuable for digital nomads. As a D7 visa holder, you will have the right to travel freely through the Schengen Area. The Schengen Area is a group of 26 European countries that have abolished passport and immigration controls at their common borders. In addition to Portugal, the remaining 25 countries of the Schengen Area are:
- Austria
- Belgium
- Czech Republic
- Denmark
- Estonia
- Finland
- France
- Germany
- Greece
- Hungary
- Iceland
- Italy
- Latvia
- Liechtenstein
- Lithuania
- Luxembourg
- Malta
- The Netherlands
- Norway
- Poland
- Slovakia
- Slovenia
- Spain
- Sweden
- Switzerland
This means that the D7 visa will give you free rein to travel through much of Europe without any additional visas required.
Who Can Qualify for Portugal’s Digital Nomad Visa?
To qualify for the D7 visa, you must meet several standards. These include the following:
- A passport that will be valid for at least six months after your D7 visa would expire
- A valid EU health insurance policy with at least €30,000 in emergency medical coverage
- A Portuguese tax identification number
- An open bank account based in Portugal
- Proof of accommodation in Portugal, such as a rental agreement or Airbnb reservation
- Proof of income (you must show that you earn enough income from a non-Portuguese source to support yourself during your stay)
- Proof of a clean criminal record
How Much Does Portugal’s Digital Nomad Visa Cost?
The fees for a D7 visa are relatively minor. When applying for your visa, you can expect to pay $100. You will also have to apply for a residence permit, which costs roughly $85.
How to Apply for a Portuguese D7 Passive Income Visa
If you want to apply for a Portuguese D7 passive income visa, simply follow these steps.
1. Get Your Portuguese Tax Identification Number
First, you must acquire a tax identification number, known in Portugal as a Número de Identificação Fiscal (NIF). This will enable you to complete other steps in the application process, such as opening a bank account and renting a home.
You can obtain an NIF remotely through a tax representative acting on your behalf in Portugal.
2. Open a Bank Account in Portugal
Once you have your NIF, you can open a Portuguese bank account. Once again, you can do this without being present in Portugal.
3. Arrange Accommodation
To apply for a D7 visa, you must have some form of accommodation in Portugal. This can mean buying property, signing a rental agreement, or simply making a reservation through Airbnb or a similar service.
4. Apply for Your Portugal Digital Nomad Visa
Now you’re ready to apply. Contact the nearest Portuguese embassy or consulate to start the application process. In some cases, you will be able to submit the required documents by mail. Otherwise, you will have to make an appointment to submit them in person.
5. Wait for Approval
Portugal’s D7 visa application process is known for its relatively short wait time. Your request should be processed within four or five months.
6. Enter Portugal and Register as a Resident
After your D7 visa is approved, you can enter Portugal freely. Upon entering the country, you will have three days to register as a resident with the Serviço de Estrangeiros e Fronteiras (Foreigners and Borders Service). It will generally take about two weeks to receive your residence permit. When your permit arrives, you can take full advantage of the benefits of a D7 visa.
And that’s it! Now you’re ready to begin your life as a digital nomad in Portugal.
Do Digital Nomads Pay Tax in Portugal?
One of the most common questions digital nomads have is whether they have to file taxes. The short answer is yes. You will probably have to file taxes in both the US and Portugal.
This is because:
- As a resident of Portugal, you will have to report your income to the Portuguese government
- Every US citizen is required to file a US tax return regardless of where they live
The good news is that because of the US-Portugal tax treaty, you generally won’t have to worry about double taxation. Plus, the IRS provides multiple tax credits that expats can use to reduce or even erase their US tax debt.
Better still, the D7 visa gives you the opportunity to apply for Non-Habitual Resident (NHR) tax status. This would allow you to pay only 20% of your standard tax bill—or possibly to completely exclude your income from taxation in Portugal.
Need Help with Your Digital Nomad Taxes? That’s Why We’re Here!
We hope this guide has helped you understand Portugal’s digital nomad visa program. If you still have questions, we have answers. In fact, we can even help you prepare and file your digital nomad taxes.
At Greenback Expat Tax Services, we help Americans living abroad file their expat taxes accurately and on time. Just contact us, and we’ll be happy to help you in any way we can. We can even prepare and file your expat taxes for years to come.
When you live in the US, tax day is simple: April 15th! When you move abroad, it’s not so straightforward! Learn about all the expat deadlines and extensions you need to know to file.
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