Demistifying the temporary visa, permanent residency and the D7. How do you chose what digital nomad visa is right for you in Portugal?
It’s one thing to dream about pasteis de nata and bolinhos de bacalhau, but an entirely different one to get the paperwork and life admin and visa in check to move to Portugal as a digital nomad.
When the 2020 pandemic hit the ground running, many countries were quick to hop on the opportunities that working from home tould provide. Offering appealing digital nomad visas is a tactic many countries have started to use to encourage the flow of affluent remote workers into their territory. Portugal was particularly savvy in luring in remote workers through savvy taxing benefits, low costs of living and exciting promises of year-round sunshine.
The Portuguese digital nomad visa (which you can apply to here!) is an initiative that has been in place since October 2022 and comes in two different forms: The long-term residency visa, and the temporary stay visa, both of which suit different types of travelers, based on how long you plan on staying in Portugal.
The Temporary Stay Visa (€75)
Temporary stay visas are ideal for those looking to dip their toes in the Mediterranean and explore the benefits of the Portuguese lifestyle… without putting a ring on it. It is valid for one year, with the possibility of extending it to two, and grants you multiple entries to the country. For this type of visa, you must prove a monthly income of at least €2820. Why? Because it proves to the government that you are entering the country with enough in your bank account to spend within its borders, bringing in an influx of money and commerce into Portugal during your stay.
The Long-Term Residency Visa (€90)
The long-term residency visa requires a bit more paperwork than the temporary digital nomad one. It mandates its applicants to submit their applications at a Portuguese Consulate close to where they currently reside (outside of Portugal, that is), and after receiving approval, the Visa grants the holder the opportunity to make two entries into Portugal and stay for a maximum of 120 days. During this period, applicants have the option to schedule an appointment with the SEF – Immigration and Border Service to transition their Visa into a Digital Nomad Residence Permit. This choice is especially suitable for individuals looking to establish Portugal as their future residence. In order to keep the Residence Permit valid, the individual must meet specific minimum residency criteria, including spending a minimum of 16 months in Portugal within the initial 2-year timeframe and at least 28 months in each subsequent 3-year renewal period, provided that no absence extends beyond 6 consecutive months.
What about the D7 visa, what is that all about?
Throughout all the digital nomad visa buzz, you might have come accross the D7 visas, which might have thrown you off slightly. The D7 visa is what most digital nomads pre-2022 would have opted for. Originally intended for retirees or passive income earners with large sums of savings in their bank accounts, this option was favored by many nomads for not mandating any Portuguese employment contracts.
Seing the country’s appeal to remote laptop workers, the country eventually launched the digital nomad visas as an alternative to the D7, making digital nomadism much more accessible.
What are the visa requirements anyway?
- You need to be a non-EU/EEA/Swiss citizen (EU/EEA/Swiss citizens are exempt from visa requirements).
- A minimum monthly income of €2,800 from sources outside Portugal is mandatory.
- Both you and your dependents must maintain a clean criminal record.
- You are required to provide evidence of one-year accommodation in Portugal, such as a rental agreement or hotel reservation.
- Upon your arrival in Portugal, you must obtain a Portuguese NIF (Numero de Identificacao Fiscal) and establish a Portuguese bank account within 120 days before proceeding with your residency application.
What about taxes?
Visas and taxes are two very separate things, and the kind of visa you have does not determine how much tax you pay during your stay. In order to understand this, you have to grasp the intricacies of tax residency.
As a digital nomad, your best bet is to apply for tax residency in Portugal, which you can do if you spend more than 183 days a year within the country. Once a tax residence, you can then consider getting what is known as the NHR status (Non-habitual resident), which provides discounted tax for up to 10 years. This allows nomads to not pay taxes on any income from abroad, and a flat rate of 20% of any Portuguese earnings.
Digital Nomads and Portugal
Offering appealing digital nomad visas is a tactic many countries have started to use to encourage the flow of affluent remote workers into their territory. Portugal was particularly savvy in luring in remote workers through savvy taxing benefits, low costs of living and exciting promises of year-round sunshine.