Expats in Portugal: The Ultimate Guide for 2025

For many expats in Portugal, living in the country means being surrounded by incredible charm and culture—a blend of architecture, rich cuisine, tradition, history, and innovation. From the local markets, Portuguese people, or something as simple as traditional dishes, it’s easy to distinguish why people living in Portugal love this EU country.

But what exactly makes Portugal such a sought-after tourist and expat destination? In addition to being a safe country with a warm climate, obtaining Portuguese citizenship offers many benefits.

In this article, you’ll discover how expats in Portugal are navigating the country, and find out more about:

• Overview of living in Portugal as an expat
• Living costs of expats in Portugal
• Housing and healthcare in Portugal
• Taxation considerations

Overview of Living in Portugal as an Expat

Portugal has become one of Europe’s top expat destinations as digital nomads, retirees, families, and entrepreneurs can all carve out their own space. Affordable living, warm climate, friendly locals, and a laid-back lifestyle make it very appealing, and it certainly helps that it boasts an impressive stretch of Atlantic coastline.

There are certainly pros and cons to living in Portugal as an expat, but one of the drawcards is that everyday expenses remain reasonable compared to other Western European countries. However, it comes with a caveat. Most expats want to live in the city, but housing in major cities has become noticeably more expensive in recent years.

Lisbon leads as the priciest city, followed closely by Porto. Smaller towns and rural areas offer much cheaper housing options, often providing a more authentic and relaxed lifestyle for those willing to live outside urban centers.

But what is living in Portugal as an expat in Portugal really like? Well, at its core, it’s a mix of comfort and subtle challenges that only become clear once you settle in. Daily life tends to move slower than in Northern Europe or North America. This can be relaxing, but also frustrating when bureaucracy or services move at a crawl. Getting official paperwork done, from residency to driver’s licenses, often requires patience, multiple visits, and sometimes vague instructions.

The Portuguese lifestyle is deeply rooted in tradition and this slower pace of living. People enjoy long meals, social gatherings, and a strong sense of community. While locals are friendly and helpful, integrating into Portuguese social circles can take time, especially in smaller towns where relationships are often generational. Learning Portuguese, even at a basic conversational level, can make a huge difference in building connections and navigating daily life.

But there’s no shortage of things to do in Portugal, so there’s always something amazing available for expat life in Portugal.

Living Costs for Expats in Portugal

The cost of living in Portugal versus the US depends on many factors, including an expat’s income, but generally speaking, a modest salary is sufficient to get by in Portugal.

From sipping a coffee for less than €1 to tucking into a hearty meal in a mid-range restaurant for €10, food expenses are reasonably priced. A family of four can easily get by with €300 per month on groceries. Fresh salmon at the market can cost as little as €4.

Rent in Portugal’s urban cities like Lisbon or Porto can get pricey, with a one-bedroom apartment in Principe Real easily racking up to €1000 in monthly rent.

Meanwhile, renting in one of Portugal’s low-density areas is considerably cheaper, with a one-bedroom costing on average €500.

Housing for Expats in Portugal

Many expats prefer to rent long-term before buying property in Portugal. This gives them more than enough time to explore the country and decide where they want to settle down. Either way, Portugal offers a variety of real estate options for expats.

There’s something for everyone, from luxury condos and apartment complexes to traditional houses in Alfama. Whether you plan to rent or buy, it’s important to consider what you need to be comfortable. Consider the different architectural styles in the country and your comforts, such as central heating or air conditioning, before deciding where to live.

These additions may impact your rental price. For instance, a condo in Lisbon’s city center will always be more expensive than one outside the city. Below is a list of options for finding suitable accommodation for expats in Portugal.

Short-term stays or monthly rentals

• Airbnb
• Booking.com

Long-term rentals

• Idealista
• Facebook groups

Buy real estate in Portugal

• Goldcrest – Portugal Buyers Agent
• Idealista

Healthcare in Portugal for Expats

Healthcare in Portugal is a comprehensive, tax-funded public system called Serviço Nacional de Saúde (SNS). Under the SNS, most essential medical services are free, while non-essential services and treatments are affordable.

Expats living in Portugal may be eligible for the SNS, provided they have all the necessary documentation and a unique tax identification number.

EU citizens in Portugal can get free treatment temporarily, provided they show a valid European Health Insurance Card (EHIC). They are eligible to use the public health system for free for up to 90 days. Afterward, they must register as legal residents to continue tapping into health care privileges.

Non-EU citizens, including British citizens and Americans living in Portugal, aren’t entitled to the public health system unless they have legal residency, have applied for the SNS, and are paying social security. Note that various private health insurance providers exist, like Medis or Multicare.

Education and Schools for Expats in Portugal

Education in Portugal for expat families offers a range of choices, but navigating them depends on priorities like language, budget, and long-term plans.

Public schools are free and open to all residents, including expats with residency permits. They follow a national curriculum and are taught entirely in Portuguese. This can be a great option for younger children, who tend to pick up the language quickly and integrate well. However, older children who don’t speak Portuguese may struggle, especially in academic subjects where language mastery is key. Support for non-native speakers varies by school and region.

Private schools, both Portuguese and international, are common in larger cities. Portuguese private schools are often more affordable than international ones and may offer bilingual programs, though many still teach primarily in Portuguese.

On the other hand, international schools in Portugal are the go-to option for families seeking a smoother transition. They offer British, American, or International Baccalaureate (IB) curricula, and all lessons are in English or the school’s main language of instruction.

Tuition is high by local standards but usually lower than in other Western European countries. Popular international schools in Lisbon, Cascais, Porto, and the Algarve tend to have long waiting lists, so applying early is crucial.

Working Life for Expats in Portugal

Whether you’re a digital entrepreneur, eager to start your startup, or planning to work for a Portuguese-based company, it’s important to know that working in Portugal differs from other European countries.

Working for a Portuguese company

• Working hours: For a standard business, you can expect to work between the hours of 8:30 am to 6 pm. By law, you’ll have a maximum working week of 40 hours.
• Paid leave: Full-time employees can expect 13 days of paid public holiday leave and a minimum of 22 working days’ holidays.
• Earning potential: The average salary in Portugal depends on the line of work and position you’re in.
• Business etiquette: In Portugal, business is conducted in a more traditional manner. Face-to-face meetings are preferred, and written communication is considered somewhat impersonal.

Punctuality is also not considered a priority like in some other countries. Don’t be surprised if your meeting starts twenty minutes late or a team member turns up half an hour late to a meeting.

Self-employed expats

Dubbed Europe’s Silicon Valley, mainland Portugal and Lisbon are extremely attractive locations for non-EU or British expats looking to run a startup in Portugal. The startup scene is real, and Portugal’s stable economy is an attractive bonus for expats looking to kick-start their businesses.

For digital entrepreneurs, Portugal welcomes digital nomads with open arms. There are hundreds of cafes, and co-working spaces, each offering fast, reliable internet to get your work done. You can also utilize a coworking app called Croissant, allowing nomads to find what they need to work in Portugal or neighboring EU countries.

Work visas in Portugal

Non-EU citizens will need to apply for a Portugal work visa to be able to work in the country legally. There are several visa options to consider:

• D2 Visa – This is considered an entrepreneur visa, which allows applicants with the relevant means to start or expand their business in Portugal.
• D3 Visa—This visa is reserved for qualified individuals with specialized experience in certain fields, such as professors or within the tech industry. Applicants must have a contract with a Portuguese company to qualify.
• D8 Visa—Also known as the Digital Nomad Visa, the D8 allows freelancers to live and work in Portugal, provided they have a steady income four times the national minimum wage as your average salary.

The D7 Visa allows those with passive income outside of Portugal, such as real estate rentals, shares, or other investments, to live in Portugal. Passive income means you have a stable flow of money into your bank account that is generated passively from investments, which you can live on. Therefore, on the D7 Passive Income Visa, you are not allowed to work and earn money in Portugal.

All of these visas allow applicants to obtain Portuguese citizenship after certain criteria have been met.

Traveling in Portugal as an Expat

International travel

Lisbon’s main airport has excellent air connections to the rest of Europe and direct flights to several African nations, the United States, and the United Arab Emirates. Depending on your residency permit, most expats can enter and exit Portugal to the Schengen Areas without needing an extra visa.

Public transport

Trains

Portugal’s railway system is fairly developed, and trains are a popular mode of transportation. The Metro operates within the Lisbon and Porto CBD, but an overland network also travels outside these cities. A return ticket from Lisbon to Porto costs around €30.

Buses

Buses are considerably cheaper, with a two-way ticket to the Algarve region costing about €15.Regarding city transportation, Lisbon and Porto boast an excellent bus route system.

Own transport

Many people in Portugal have their own mode of transport. As the roads within the old cities are quite narrow, you can expect large traffic volumes, especially in peak times. To avoid this, many residents opt for Vespas or scooters—even cycling but be aware that Lisbon is built on seven hills, so cycling may not be a viable option for everyone.

Taxation Considerations for Expats

Expats in Portugal often find the tax system tricky to wrap their heads around. If you’re a freelancer or happen to have your own business, then getting an accountant is recommended. Expect to get taxed between 14.5% and 48% of your income, depending on your income bracket. Always ask your accountant if you qualify for any tax incentives, especially regarding cryptocurrency.

IFICI replaced the NHR

Portugal’s new Tax Incentive for Scientific Research and Innovation (Incentivo Fiscal à Investigação Científica e Inovação — IFICI) is the official replacement for the Non-Habitual Residency scheme, which ended in March 2025.

Sometimes referred to as NHR 2.0, it is a 10-year tax incentive regime aimed at attracting qualified professionals and entrepreneurs working in key economic sectors like science, technology, education, and innovation.

It offers reduced tax rates on Portuguese income and exemptions on certain foreign-sourced income.

Those who qualify for IFICI will benefit from a flat tax rate of 20 percent on eligible professional income arising from Portugal and possibly an exemption on professional foreign-sourced income.

Here’s a quick glance at some of the benefits that will last for a 10-year period:

• Portuguese sourced income: 20% flat rate on Portuguese source employment and self-employment income, compared to standard progressive rates that can reach up to 480/0 for high earners. The flat rate applies regardless of income level, providing predictability and simplicity in tax planning, and applies to income derived from eligible activities performed for qualifying Portuguese entities.
• Foreign-sourced income: 0% taxation (full exemption) on all foreign-sourced income, including:
  – Foreign employment income
  – Foreign selfæmployment income
  – Foreign investment income (dividends, interest, royalties)
  – Foreign capital gains from the sale of securities, crypto assets, and other investments
  – Income from intellectual property
  – Foreign rental income
• Enables tax-efficient asset allocation between Portuguese and foreign investments
• Provides opportunities for entrepreneurs with international business interests.
• Benefits digital nomads and remote workers with foreign employers.
• Creates advantages for international consultants and professionals operating across borders.
• Allows for tax-free growth of foreign investments during the 10 year period.

Banking in Portugal for Expats

Portuguese banks are essential for residents as they simplify financial transactions. The banking system is controlled by Portugal’s Central Bank (Banco de Portugal) and the European Central Bank (ECB), two regulatory bodies that ensure the stability and compliance of the Portuguese banks with European Union financial regulations.

More than 150 banks operate nationwide, including public and private retail banks. You can also find cooperative, investment, and commercial banks.

Major Portuguese banks offer various types of services, including personal, corporate, investment, and private banking. Additionally, there is a growing presence of digital and mobile banks, as well as fintech companies that provide innovative online services in Portugal.

Opening a bank account is fairly straightforward, with various options and reputable banks such as Barclays, Bankinter, and BPI. Most banks are open between 8:30 am and 3:00 pm on weekdays and may close on weekends. Banks in smaller towns usually close for lunch.

Best Expat Communities in Portugal

Lisbon

Lisbon appeals to the young at heart and is considered one of the best places to live in Portugal. It’s the perfect place for those who feel energized by buzzing city life and want to be in the middle of a vibrant tech startup environment.

Lisbon’s cost of living is among the highest in Portugal as the capital city. However, compared to other European Union capital cities like Paris, these costs are still very reasonable.

Cascais

Just a quick 30-minute drive from the Lisbon airport, the former fishing village of Cascais retains a sophisticated charm, with less hustle and bustle than Lisbon. Despite having more than 200,000 inhabitants, Cascais is still considered a village and retains much of that traditional Portuguese society charm.

In earlier years, Cascais was popular with royal families, who would visit the beaches every chance they got for warm sand and sunny weather.

Porto

Porto has always been a popular choice for Americans moving to Portugal because of this old fishing town’s blend of rich culture and modernity. Most known for its Port Wine, beautiful beaches, laid-back lifestyle, and UNESCO World Heritage Site city center, it’s an incredible city for many expats and digital nomads alike.

As the second-largest city in Portugal, it’s also more affordable than the Lisbon region, making the affordable cost and property prices an attractive incentive for foreign citizens.

Algarve

The Algarve’s golden coast is a great place to consider if you’re moving to Portugal.

With beautiful, unspoiled beaches and dramatic rocks along the shoreline, this region has been a haven for expats for generations. British, Canadians, and Americans living in the Algarve choose this area for its relaxed lifestyle and warm climate.

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Frequently Asked Questions about Expats in Portugal

What is living in Portugal as an expat like?

Living in Portugal is about adjusting to a lifestyle where personal connections, routine pleasures, and a slower rhythm dominate over ambition or urgency. Expats who embrace this often thrive, while those who expect efficiency and fast-paced living may struggle.

Where do expats live in Portugal?

Most expats in Portugal live in Lisbon, Porto, and the Algarve. Lisbon attracts digital nomads and professionals, Porto offers a mix of culture and affordability, and the Algarve is popular with retirees for its beaches and mild climate. Smaller towns like Cascais and Coimbra also have growing expat communities.

Which city in Portugal has the most expats?

Lisbon has the most expats in Portugal. The city attracts a diverse international community, including digital nomads, retirees, and entrepreneurs. Expats choose Lisbon for its job opportunities, vibrant culture, and English-friendly services. Popular neighborhoods include Alfama, Príncipe Real, and Parque das Nações.

Is it safe to live in Portugal for expats?

Is Portugal safe? Yes. It is very safe to live in Portugal for expats. Portugal consistently ranks as one of the safest countries. Violent crime rates are extremely low; pickpockets, however, are common, and they’re mainly in areas populated with tourists.

What are the benefits of living as a Portugal expat?

Several key benefits of living in Portugal include the fact that English is widely spoken, there’s modern technology and architecture, a fantastic and dynamic property market, and healthy and affordable living.

Do I need to speak Portuguese to live in Portugal?

Most Portuguese citizens who have completed schooling in Portugal will have at least a basic understanding of English. If you are moving to one of the major cities, like Lisbon or Porto, there’s a good chance you can get by with basic Portuguese or none.

Is renting in Portugal expensive for expats?

Renting in Portugal is generally more affordable for expats compared to most Western European countries, particularly in smaller towns and rural areas.

While major cities like Lisbon and Porto have higher rental prices in popular neighborhoods, there are still budget-friendly options available. Many expats find that the overall cost of living, including rent, allows for a comfortable lifestyle.

How do expats in Portugal manage banking and finances?

Expats in Portugal manage banking and finances by opening local bank accounts, often requiring a NIF (tax number), proof of address, and ID. Online banking is widely used for payments and transfers. Many expats also maintain foreign accounts and use international transfer services to manage currency exchange.

Is Portugal friendly to American expats?

Yes, Portugal is friendly to American expats. Locals are welcoming, English is widely spoken, and the country offers a safe, relaxed lifestyle. American expats benefit from established communities, especially in Lisbon and the Algarve. Residency options like the D7 visa make relocation accessible and appealing.

How much money do you need to be an expat in Portugal?

To be an expat in Portugal, you typically need €1,200 to €2,000 per month to cover rent, utilities, food, and healthcare. Residency visas like the D7 require proof of income, around €820 monthly for a single applicant. Coastal cities and tourist areas may require higher budgets.