Brief analysis of benefits and opportunities you can access to in Portugal, whether to start a business, a new life, or simply to find a prime holiday destination.
Portugal, a country that combines history, culture, landscape, leisure, and entertainment presents itself to the world, not only as one amazing holiday destination, but also, and more importantly, as one of the best places to live and focus your interests into.
Let us see more in detail why Portugal is so special and what this country has to offer you and potentially completely change your life for the better.
The spotlight
Between the 15th and 16th century Portugal was discovering a bigger world and adding entire continents to our maps. In the last decade the world is re-discovering Portugal and putting it in the spotlight it deserves. What is catalysing all these increased interest in this apparently small country, sitting at the western verge of the European continent? We will give no short answer to this question, but a short suggestion is due: you should definitely give this country your attention, and at the end of this article you will have no choice than totally agree with it.
Portugal is attracting many international investments, as an example China Three Gorges Corp signed a deal with Portuguese power giant Energias de Portugal (EDP) and bought a 21.35% of its stake at around 2.69 billion euros. Apart from the money invested in the shares, the financial package comprised 8.7 billion euros in investments.
In the past few years Portugal has been nominated and awarded in so many categories by the World Travel Awards, you wonder how it is possible to pack so many amazing destinations in such a small country: first Best World Destination 2019 and first Best European Destination 2020. Algarve has won as Europe’s Leading beach Destination 2020, as well as Lisbon, Porto and many facilities and attractions has won awards in their respective categories.
So let us scratch the surface and unveil the secrets behind all the fuss.
Services and security
Portugal has been ranked as the third safest country in the world (according to the Global Peace Index) and the safest Europe with one of the lowest crime rates. It grants an unparalleled political, economic, and everyday security, even for European standards. The government is really stable, there haven’t been major issues or crisis in the past decades, as in many other countries, and Portugal has proven itself capable of withstanding global economic crisis far better than most. In fact, after the recession around 2010-2011, the economy has grown always stronger, unemployment has halved and many new businesses and star-up have opened, thanks also to the many incentives we already talked about and the trending growth of tourism, services, and construction fields.
To overcome those past difficult times, Portugal has also undergone a series of efficiency improvements in the bureaucracy and the public sector, achieving a better quality of the services for the citizens and a great simplification thanks to a strong implementation on informatic systems and innovation.
Adding onto that, the healthcare here is one of the best in Europe with many affordable private schemes available.
Portugal a relatively compact, small country, with a good infrastructure and transportation system, making easy to move in the country, while transportation inside the major cities is fairly modern and efficient with reasonable fares.
Many airports connect it fast and cheap with the farthest destinations and thanks to the historically advantageous location is one of the biggest ports of the world, which is particularly interesting for transportation of wares and materials all over the world.
There is a good public school system and many international, multilingual schools with very excellent programs and ratings. There are many renowned universities, especially in the fields of engineering, technology, and arts.
The financial benefits
In Portugal you can access excellent tax advantages, like the non-habitual tax regime, and there are no inheritance or gift tax, as well no wealth tax.
The tax system is extremely attractive and for more than one category. The government introduced a series of incentives to attract investors and wealth.
The RNH status (Non-Habitual Resident) offers a flat tax rate of only 20% for working people (which basically is less and half the average tax rate in many European countries)
There is no wealth tax. No inheritance tax for spouses and direct heirs. No VAT for rents.
Taxes on property are moderate and there are many exemptions on real estate capital gains, especially if they are reinvested or focused on the requalification of the cities.
There are no restrictions on the entry of foreign capital and there is a principle of non-discrimination regarding nationality. Hence, Portugal does not require investors to have national partners and does not lay down any restrictions on the distribution of profits or dividends abroad.
In addition, it is now extremely easy to start a business (it can be done in less than an hour) and the government provides an online toolkit that has made life much simpler for businesses and citizens with the automation of an increasingly extensive range of operations. There is also the Simplex program, which has been responsible in recent years for simplifying and dematerializing hundreds of administrative and tax procedures.
The real estate market
The real estate market in Portugal is one of the most dynamic, many investors from all over the world are setting their interests in the country and the cities are increasingly getting livelier and even more beautiful, thanks to the reconditioning of old buildings or the realization of new ones.
There is a wide choice of available properties, thanks to the broad spectrum of landscapes and businesses that Portugal offers, and the rates of investment return are remarkably interesting and some of the best of all markets.
Rental incomes, especially for seasonal renting are attractive, especially due to the big increase in tourism. This makes investing in real estate very profitable, also if you want to have a steady income through a rent.
According to statistic expected gross rental yields in Portugal are among the highest in Europe, from 5% to 14% is achievable from the right property.
If you want to buy a property in Portugal, and you are wandering what the best moment is, the answer is always know. The real estate market is in constant and steady development: there is no foreseeable inflection or diminishing in the ratings, therefore any good property should see an increase in value in the next future.
According to studies conducted by the British audit and consulting firm PwC and the American association Urban Lan Institute, Lisbon is ranked as one of the most interesting cities to invest in real estate. The reasons, aside of the life quality and the beautiful country, are the growth of the economy, the stability and all polices and incentives that are attracting the interests of private investors and companies.
Prices pro sqm are still attractive and below average, despite the market growth in the past years, when compared with the other countries.
Easy legislation and moderate taxes concerning property acquisitions make investments even more attractive. Portugal has put in place a legislation and more simple, secure procedures to buy property, that allow a smooth and controlled process for both buyers and sellers (named Casa Segura or Casa Simples). Should be noted that in many countries real estate agency requires a commission from buyers (or both buyer and seller): usually in Portugal, the buyer pays no commission. Furthermore taxes, notary, and government fees set themselves around 5%-6% of the property cost, which is fairly below average in comparison with the European countries.
There is a wide choice of property in Portugal, being itself such a rich and eclectic country: from small shops and offices to big modern building for firms and multinationals, from apartments to villas, both historical and new. We can help you find the right investment for you and design it to perfectly fit your needs. So, what property are you looking for?
The Golden Visa
The Portugal Golden Visa, is a fast track for foreign investors from non-EU countries to obtain a fully valid residency permit in Portugal. It was launched by Portuguese authorities in October 2012, through which non-EU citizens can through investment activities in Portugal can qualify for a residency permit and eventually passport for Portugal. This permit allows the investor to enter and/or live in Portugal, and to travel freely within the majority of European countries (Schengen Area).
The Portugal Golden Visa is a straightforward, flexible programme, aimed at attracting foreign investment into Portugal. It is considered one of the most attractive residency programmes in the world since investors do not need to live in Portugal and can include both dependent children and dependent parents.
The holders of a Portuguese Golden Visa have many advantages:
• You do not need a visa to enter Portugal or travel through Europe (Schengen Area).
• You can live and work in Portugal, even with residency in a different country.
• Portuguese residency can be extended to family members.
• It has extremely low minimum stay periods compared to other residency / citizenship programmes.
• You can attain permanent residency after five years.
• You can attain citizenship after six years.
The territory and the environment
We will not indulge too much on this topic, because this article is not just about tourism, but there are a couple of things that are worth to mention and may also interest the new residents.
One of the oldest and richest cultures in Europe and the legacy of its former wealth and power can be seen in its historical sites. Among the sites inscribed in the World Heritage List of UNESCO, 13 are located in Portugal.
Portugal is a gorgeous and very welcoming country, perfect for holidays, sure, but also to set up a business or to simply spouse your working routine with a high life quality: the moment you close your pc or exit your working place, you just find yourself in one of the most beautiful locations in the world and usually around 30 to 60 min away from a beautiful beach.
The weather is unbeatable. An average of 300 sunny days per year, dry and ventilated and the healthy presence of the ocean.
The combination of hot summers cooled by the Atlantic breezes and warm winter days make the climate unbeatable. The rain keeps the country green, but with short heavy bursts it’s rare to have grey skies for too long. In short: living here is really comfortable and also healthy.
To close the topic: Portugal is also one of the best places to eat. Period. Just try it.
Conclusions
With this article we gave you a good sneak peek of this amazing country: feel free to inquire more and research what interests you the most. On the web you can easily find more official information, even in English, to dive deeper in all of the topics we mentioned.
We really struggle to imagine something that Portugal can’t offer (snow?) and we invite everyone to come and see with your own eyes what we are talking about.
Should you be interest in investments in the real estate market, our office can support you, even from abroad, presenting you the best choices for your plans and providing you with more insights and tools, thanks to our architectural skills, to maybe turn an overlooked property in a jewel and a great investment opportunity.