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Retiring to Portugal

A foreign retiree who settles in Portugal becomes tax resident after more than 183 days, or by keeping a habitual home there. How the pension is taxed then depends on the treaty between Portugal and the paying country, and on whether the pension is a public or a private one.

Your situation

You have moved to Portugal, or you are preparing to, and you receive a pension from another country. The first question is not the tax rate: it is which of the two states has the right to tax it.

When do you become tax resident?

As a rule, once you spend more than 183 days in Portugal over twelve months, or you keep a home there in circumstances suggesting you intend it as your habitual residence.

Public or private pension: the decisive distinction

Type of pension Usual treaty rule
Private pension Taxed in the state of residence
Civil service pension Taxed in the paying state
State social security Varies by treaty

Every treaty has its own wording. The analysis is done with the applicable text in hand, never by analogy with another country.

What still has to be declared

Even where the pension is not taxable in Portugal, it may still have to be reported, to set the rate applying to your other income. Filing obligations in your home country may also continue.

The EA services for this situation

  • Personal IRS returns

    An IRS return costs between €20 and €250 plus VAT depending on complexity: number of filers, types of income, income earned abroad and whether a double tax treaty applies. Both residents and non-residents are covered.

  • On-site support

    On-site support costs €75 per hour plus VAT, with €0.45 per kilometre and tolls on top. We come with you to the bank, the tax office, social security and the notary, interpreting in Portuguese, French and English. Minho region and northern Portugal.

  • Consulting

    Consulting is charged at €75 per hour plus VAT. The first consultation is free: it frames your question, identifies which obligations apply and sets out the way forward, with no commitment.

  • Investment taxation

    We handle the tax treatment of crypto assets, ETFs and shares in Portugal, for residents and non-residents alike: how income is classified, capital gains calculation, holding periods and IRS reporting.

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