See the Budget tracker for announcements and effective dates.
How does take-home pay compare with the UK?
Annual GBP at the same gross salary, using the UK and destination engines. Single employee, no children or voluntary pension contributions. A converted salary is not a local job offer.
| Gross salary | UK take-home | Portugal take-home | Difference before rent |
|---|---|---|---|
| £50,000.00 | £39,519.60 | £31,721.08 | -£7,798.52 |
| £75,000.00 | £54,057.40 | £44,047.58 | -£10,009.82 |
| £100,000.00 | £68,557.40 | £55,263.90 | -£13,293.50 |
| £150,000.00 | £91,286.40 | £77,291.40 | -£13,995.00 |
How is employee pay taxed?
The mainland model includes income tax, the solidarity surcharge and employee social security, with the larger of the standard deduction or eligible contributions. Comparisons start at GBP 13,852, above the minimum-existence relief exclusion threshold for the single employee assumed here. That relief is not modelled; lower-pay cases are excluded. Invoice-based expense credits and special regimes are omitted.
NHR Portugal and the IFICI tax regime: eligibility and limits.
Tax period: 2026. Main city used: Lisbon.
How is ordinary Portuguese salary taxed?
The mainland 2026 IRS schedule starts at 12.5% and reaches 48% above EUR 86,634 of taxable income. Each rate applies to its own slice. CIRS article 68-A adds solidarity tax at 2.5% between EUR 80,000 and EUR 250,000 and 5% above that.
The engine deducts the greater of EUR 4,587.09 and mandatory employee social security paid. It assumes an 11% employee contribution without a ceiling. The Portuguese social security service confirms the 11% employee rate (checked 25 October 2026).
What does the Portugal model calculate at EUR 40,000?
Employee social security is EUR 4,400 and the specific deduction is EUR 4,587.09. Taxable income is EUR 35,412.91. Applying the progressive bands gives IRS of EUR 8,149.26 and take-home of EUR 27,450.74.
This annual-liability example uses the Portuguese sources below. Minimum-existence relief is not modelled: this single employee’s pay is above its exclusion threshold. Salary comparisons start at GBP 13,852 using the saved ECB exchange rate, so lower-pay cases where relief may apply are excluded. The model also omits invoice-based expense credits, dependants, IRS Jovem and NHR/IFICI special regimes. Sources: CIRS article 70 and the 2026 IAS order, checked 25 October 2026.
Can a new arrival claim NHR or IFICI?
Older NHR descriptions do not establish eligibility for a new applicant. Existing beneficiaries and transitional cases have separate rules. The research and innovation incentive, called IFICI, requires specified work and employer conditions.
IFICI is not a general offer to British retirees. The ordinary employee model applies neither regime. The Portuguese tax benefits code is the source for the incentive.
What permission do I need to live and work here?
UK citizens need a residence visa then a residence card from AIMA. Routes include work, digital nomad, study, retirement, family. Permanent residency possible after 5 years on a temporary card. Portugal allows dual citizenship with the UK.
Which residence route should a British citizen use?
GOV.UK Living in Portugal links the routes for work and non-working stays. New applicants need permission matching their activity; people with protected existing rights can have different arrangements. A visitor's entry does not establish a right to settle.
What changes for UK pension payments?
Portugal falls within DWP's annual State Pension increase coverage. Taxation of pension income still needs the destination and treaty rules. The UK pensions abroad guide explains the separate payment and transfer questions.
Where can I check investment residence rules?
Read the Portugal investment residence routes and minimums alongside the investment residence comparison. Immigration permission and tax residence need separate checks.
How much rent does the comparison assume?
Rent estimate in Lisbon: €1,405.77/month for a city-centre one-bedroom home; Numbeo: Lisbon city-centre one-bedroom rent, checked 25 October 2026; method and exclusions.
Getting residence
Enter on the appropriate residence visa, then apply for a residence card. Work and non-working stays have separate conditions. The Agency for Integration, Migration and Asylum (AIMA) handles residence applications; the Portuguese consulate handles the visa stage.
FCDO, Living in Portugal. Source date: . Checked .
Healthcare
Registered residents can join the national health service (SNS), whether working or not. Take your passport, residence certificate and tax number to the local health centre for a healthcare user number. Private insurance is optional once covered by the resident system.
Department of Health and Social Care, healthcare in Portugal. Source date: . Checked .
An eligible UK State Pension recipient can ask NHS Overseas Healthcare Services for an S1 certificate, which confirms UK-funded healthcare. Register it with the local social security office. Eligibility depends on which country is responsible for your healthcare.
Department of Health and Social Care, healthcare in Portugal. Source date: . Checked .
Schools
Migrant families can enrol children through the school registration portal or school office. If documents are missing, explain this to the school. Bring previous school records so staff can assess the right class.
Portuguese Child Guarantee, migrant school enrolment FAQ. Source undated. Checked .
Banking and money
Lawful EU residents can request a basic payment account here, subject to identity and anti-money-laundering checks.
European Commission, basic payment accounts. Source undated. Checked .
The currency is the euro (EUR).
European Central Bank, euro area countries. Source undated. Checked .
Declare cash of EUR 10,000 or more when entering or leaving the EU.
European Commission, EU cash controls. Source undated. Checked .
Cost of living
Household price level: 86.6 in 2025, EU average 100. Preliminary national comparison; your household budget will differ.
Statistics Norway, Eurostat price level survey. Source date: . Checked .
Driving
A registered resident can drive on a valid UK licence until it expires. Register it with the Institute for Mobility and Transport (IMT), or exchange it for a Portuguese licence without a test. Check the process before the UK licence expires.
DVLA, UK licence holders living in Europe. Source date: . Checked .
UK pensions
The UK State Pension receives annual increases in Portugal.Frozen State Pension guide.
DWP, State Pension annual increases country list. Source date: . Checked .
See the Moving abroad checklist for UK reporting and residence checks, school questions and bank account checks.