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If you’re considering traveling to Europe as a digital nomad, as a business owner, or as a self-employed freelancer, chances are you’ve heard of the new digital nomad visas in Portugal and Spain. If you’re looking for warm weather, affordable cost of living, and historic charm in Europe these are the countries to consider! But how do their digital nomad visas compare? And which country is best to live in as a digital nomad?
Digital Nomad Visa Benefits Compared - Portugal vs. Spain
First things first – when we compare Portuguese and Spanish digital nomad visas we are actually talking about 3 visa types:
The short-term Portuguese digital nomad visa (good for 180 days initially)
The long-term Portuguese digital nomad visa/residency (renewable for up to five years)
The Spanish digital nomad visa (renewable for up to five years)
For all three visas, you can travel freely throughout the EU, and bring dependents along with you to the country.
Read on to see how these two digital nomad visas compare, and get the information you need to decide which visa will be better for you.
Settling down in Spain and Portugal
What is especially exciting about these visas? They are not your typical one-year digital nomad visas.
Both the Spanish and Portuguese digital nomad visas offer the opportunity to relocate long-term or permanently. In Spain and in Portugal you are able to renew your digital nomad visa to last for up to five years, at which point you are eligible for permanent residency. So if you are interested in moving to Portugal or Spain for a longer period of time, you’re in luck!
In order to be eligible for renewal, keep in mind that you will need to be living in the country for at least six months of the year.
The winner? It’s a tie.
You have the flexibility in both cases to live in the country for the long-run.
Digital Nomad Visa Requirements Compared - Portugal vs. Spain
There are many similarities between the Portuguese and Spanish digital nomad visa requirements:
Both Spain and Portugal allow full-time remote employees and self-employed freelancers/contractors to work in their countries under digital nomad visas.
You cannot be working for a company located in Portugal or Spain, respectively.
There are no restrictions on industry or the type of job you have.
Both countries ask for health insurance, proof of a recent clear criminal record, and require employees to provide an employer letter stating that you are allowed to work abroad.
In both countries, in order to maintain your visa, you will need to reside in the country for at least 6 months out of the year.
While there are some differences in required paperwork, the biggest difference is the income requirement.
Portugal Digital Nomad Visa Income Requirement
Portugal requires all digital nomad visa holders to make at least 4 times the minimum wage. For 2023, that means making on average at least €3,040 per month for the past 3 months (€9120 in total). If you want to bring dependents the amount is higher. To add a spouse or a parent, add an additional 50% of the minimum wage per month to the main applicant income. To add children, add 30% of the min wage for each child per month.
Spain Digital Nomad Visa Income Requirement
Spain requires digital nomad visa holders to make at least 2 times the minimum wage. This means you’re making at least €2,334 per month (note: this may be revised slightly upward before the end of March 2023 when Spain finalizes their requirements). Adding a dependent increases the income requirement an additional 75% of the Spanish minimum wage. 25% is added for each additional family member after that.
The winner in this category? Spain. It’s easier to qualify for the Spanish digital nomad visa with remote income than it is in Portugal.
Red Tape: How Difficult is the Process of Applying for the Digital Nomad Visa in Portugal vs. Spain?
Neither country makes it easy, but there is a notable exception: Portugal’s short-term digital nomad visa comes with fewer requirements and hoops to jump through than their long-term digital nomad visa/residency. You can also expect an answer more quickly on your application if you apply for the short-term digital nomad visa.
For the long-term digital nomad visa in Portugal and the new digital nomad visa in Spain, the process is evolving rapidly. Consulates and embassies are revising and updating what they expect from applicants in the first half of 2023, so it is hard to give a definitive answer, but we can say…
You must apply for Portugal’s digital nomad visa from your legal country of residence. If you have been traveling but not establishing residency in other countries you’re out of luck – you’ll have to come home to attend an in-person meeting in your country of residence.
For Spain, so far it appears that you can either apply from your legal country of residence OR from within Spain, provided you apply while your tourist/entry visa is still valid (for Americans and Canadians this will be within 3 months).
Portugal’s requirements for the long-term digital nomad visa also includes a year-long lease. This often means applicants must go to Portugal, secure a lease, apply to the visa and wait for approval (while paying for an empty apartment in Portugal) before moving into their new home. A pain, and maybe an expensive one.
As of now, Spain has no such requirement for the digital nomad visa.
The winner on red tape? Spain.
There are two particularly painful parts of applying to the long-term Portugal digital nomad visa – finding a year-long rental in advance of your move and the fact that you have to apply in person in your home country. With Spain you can avoid both of those pain points.
Taxes for Digital Nomads in Portugal vs. Spain
Note: This section has not been updated to take account potential changes to the NHR in 2024.
So far, things are looking pretty favorable for Spain, but keep reading! There is a very significant difference in taxation for digital nomads between Portugal and Spain.
First, an assumption we want to make clear: we assume if you care about tax then you are trying to become a tax resident in either Portugal or Spain. You want to live there for more than 6 months, you want to settle in, and you accept that you may have to pay some taxes to the government in your new home. You’re not the type of nomad who is moving to a new country every one to three months.
Great, now that’s cleared up, let’s talk about one of the most advantageous parts of the Portuguese digital nomad visa: Portugal’s tax scheme for expats.
The Non-Habitual Resident (or NHR) tax scheme is one of the most unique and exciting parts of being a digital nomad in Portugal. Under the NHR, new residents of Portugal are able to exempt nearly all foreign income (read: coming from outside of Portugal) from income tax. There is only a 10% tax on foreign pensions. Even if you are working within Portugal, if you are in a “high value profession” or an entrepreneur you pay only a flat 20% in income tax. And this lasts for ten years.
Turning to Spain, while there are still some details to work out in Spain’s new digital nomad visa on taxation, it is clear that the tax situation will not be as good as in Portugal. In Spain you will be taxed on worldwide income. It appears that digital nomads will qualify for what is known as ‘the Beckham Law’ in Spain, which would mean that they would only pay a flat 24% income tax on work-related income up to €600,000.
If you’re an American and worried about paying tax to the U.S. even as a non-resident, you can take advantage of tax credits to trade taxes paid in Spain for taxes paid in the U.S. (or vice versa), dollar for dollar.
One more way the Beckham Law doesn’t live up to the NHR? It’s good for five years instead of ten.
The winner on tax is clearly Portugal.
The Final Word
So there you have it, the pros and cons of the Portuguese digital nomad visa as compared to the new Spanish digital nomad visa. As rules and requirements evolve, as they are sure to do in the initial year of these visas’ existence, we will see if any major factors swing us more in favor of Portugal or Spain.
Portugal Digital Nomad Visa Requirements
You must be working for a company outside of Portugal to apply for the Portugal digital nomad visa. If your employer or work relationship is in Portugal you should instead apply to either the D1 Work visa, the D2 Freelance visa, or the D3 Highly Skilled Professional visa.
Additional requirements to apply:
You must provide proof of income of at least 4 times the minimum wage in Portugal over each of the last 3 months. The minimum wage in Portugal in 2023 is €760. This means you must demonstrate you earned at least €3,040 on average per month over the past 3 months (or €9120 in total).
If you will be bringing dependents the income requirement is higher. To add a spouse or a parent, add an additional 50% of the minimum wage per month to the main applicant income. To add children, add 30% of the min wage for each child per month.
You must prove you have tax residency in another country. This is usually done by including a tax return in your application
You must provide a work contract and notarized statement confirming you are able to work remotely. If you will be applying for the long-term Portugal digital nomad visa, this work contract must be valid for at least 1 year.
Documents Required for the Portugal Digital Nomad Visa
To prove professional activity
For employees, you can use any of the following:
*Employment contract (most common)
Promise of employment
Employer statement
For independent professionals/contractors/freelancers, you can use any of the following:
Company contract
Service agreement
Proposal for a service contract
There is flexibility here. If there is a more compelling document in your case, you should try to use it.
To bring your family with you (family reunification)
Must prove that you are legally married and that your children are dependents
With the “family reunification visa” (which is also new!) family members can apply for a visa at the consulate with the main D8 applicant.
Portugal Digital Nomad Visa Application Process
Collect your documents. These include:
The visa application, available online
A valid passport and copy
Two recent passport photos
Proof of travel insurance to cover medical expenses for the duration of your time in Portugal
A criminal record certificate plus a form granting the SEF permission to investigate your criminal history
Apply for the visa at the Portuguese Consulate of your current country of residency. In the United States, VFS Global provides a service as an intermediary which you can use.
Receive the visa. This is likely to take 2-3 weeks, although may take longer if there are many applications to process. Your visa will be valid for 120 days.
Travel to Portugal
Attend your SEF appointment in Portugal
Note that SEF is very backlogged in 2023. It is likely your SEF appointment will be scheduled for 6+ months after your initial visa is granted. Don’t worry! You are allowed to stay in Portugal provided your meeting has been scheduled.
Wait for your residence permit card (be sure SEF has an up-to-date address, as this will be sent via mail)
Renew your residence permit once it expires
Apply for a permanent residence permit (after 5 years) OR
Apply for Portuguese citizenship (after 5 years of residence)
Should I apply for the Digital Nomad Visa, or for the D7 visa?
While the digital nomad (D8) visa focuses on the applicant’s professional situation and income, the D7 visa focuses on the applicant’s financial situation and the source of their income. The D7 visa has a much lower income requirement – you must earn only above the Portuguese minimum wage. However, the source of that income matters. It should likely come from property, investments, or other passive means.
StartAbroad is Here to Help
Navigating the application process for Portugal’s Digital Nomad Visa can be challenging. StartAbroad offers a visa application support service, which you can learn more about here.
You can also speak with a relocation specialist for free by scheduling a 15-minute consultation, or reaching out to [email protected].
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