Summary
Portugal and the UK have updated their double taxation treaty for the first time since Brexit. The agreement aims to improve conditions for citizens and companies with ties to both countries.
Immigrant Invest’s lawyers have analysed the available details to explain what the changes could mean for British nationals moving to Portugal.
UK and Portugal's new double tax treaty explained
Portugal and the United Kingdom signed two new bilateral agreements in September 2025: one revising the double taxation treaty and another covering the exchange of privileged or confidential information. The negotiations were conducted throughout the year[1].
The signing took place during an official meeting in London between Portugal’s Foreign Minister, Paulo Rangel, and the UK’s new Foreign Secretary, Yvette Cooper, who had taken office only 10 days earlier.
Double taxation agreement
The double taxation agreement between Portugal and the UK had not been revised since Brexit in 2020, when many EU-level tax rules ceased to apply to the UK[2].
The newly signed treaty is expected to improve tax clarity and provide greater certainty for individuals and companies with ties to both countries.
The full text of the new agreement has not yet been published.
Célia Castilho,
Head of the Portuguese office
For British citizens moving to Portugal, the updated treaty helps avoid being taxed twice on the same income, which can mean a lower overall tax burden.
With stronger cooperation between the countries, the framework offers stability for long-term residency, retirement, and cross-border investment. This makes Portugal a more practical and attractive choice for British nationals.
Agreement on confidential information
Alongside the tax treaty, Portugal and the UK signed an agreement to exchange privileged or confidential information. This enables tax authorities in both countries to share data more efficiently, improving transparency and helping to combat tax evasion.
For individuals and businesses with cross-border activities, it creates a more reliable system in which records can be verified and disputes resolved more quickly.
Taxes in Portugal: what UK nationals need to know
British citizens who become tax residents in Portugal are taxed on their worldwide income. This includes pensions, salaries, rental income, and capital gains. The rates are progressive, ranging 12.50 to 48%[3].
Non-residents pay a flat 25% on Portuguese-sourced income.
To become a tax resident, one must spend more than 183 days in Portugal during the year. The days of residing do not have to be consecutive.
In Portugal, there is no general inheritance tax and no wealth tax, except on high-value real estate. Corporate tax is 20% on the mainland, with reductions in Madeira and the Azores[4].
How to move to Portugal from UK
British citizens can reside in Portugal for 90 days without a visa in any 180-day period. To stay longer, they must apply for a residence permit.
Portugal Golden Visa for investors
Portugal Golden Visa allows UK nationals to obtain a residence permit by investing at least €250,000 in the country’s economy. Applicants may choose between five options. Most investors opt for purchasing fund units for at least €500,000.
The Golden Visa is valid for 2 years and can be renewed. Maintaining Portugal residency by investment requires spending 7 days a year in the country.
Passive Income Visa for retirees
Portugal D7 Visa is issued to financially independent foreigners who earn a passive income of at least €870 per month.
The first residence permit card valid for 2 years. After that, it can be extended for another 3 years. To keep the status, residents must spend at least 16 months over 2 years in Portugal.
Digital Nomad Visa for remote workers
Portugal Digital Nomad Visa is granted to foreigners who work remotely. The key requirement is to earn at least €3,480 per month from sources outside Portugal.
The residence permit is issued for 2 years. It can be extended for 3 more years. The digital nomad needs to prove they have spent either 1.5 consecutive years or 16 months in total in Portugal within 2 years of holding the permit.
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