Pondering about moving to Portugal, pros and cons? Portugal has become one of Europe’s most attractive destinations for expatriates, remote professionals, and investors. Its combination of security, lifestyle, and business opportunities appeals to people seeking a balanced life in the European Union.
Yet, before making the decision, it is essential to understand both the advantages and challenges. This article outlines the main pros and cons of moving to Portugal, with special attention to Madeira, one of the country’s most welcoming regions for newcomers.
1. Pro: Excellent Quality of Life
Portugal consistently ranks among the safest and most peaceful countries in the world. Residents enjoy a relaxed pace of life, low crime rates, and a strong sense of community.
Madeira offers an additional advantage: a mild climate throughout the year, friendly locals, and outstanding public amenities that make daily life easy and enjoyable.
2. Pro: Attractive Tax Framework for New Residents
Portugal offers several programmes designed to attract foreign residents. The Non-Habitual Resident (NHR) regime, which remains valid for those who registered before 2024, offers reduced rates and exemptions on certain income.
New arrivals can benefit from the Tax Incentive for Scientific Research and Innovation (IFICI), which applies a flat 20% rate to qualified income and exemptions for foreign-source earnings.
For entrepreneurs and companies, the International Business Centre of Madeira (MIBC) enables eligible firms to benefit from a 5% corporate tax rate on qualifying income, one of the lowest rates in the European Union.
3. Pro: Residency Options for Different Profiles
Portugal offers multiple visa routes tailored to various situations.
- D2 Visa: for entrepreneurs and investors starting a business.
- D7 Visa: for individuals with passive income, pensions, or savings.
- D8 Visa: for remote workers employed by non-Portuguese entities.
Each option grants the right to live, work, and study in Portugal and can lead to permanent residence or citizenship after a period of five years. Madeira offers efficient local support for each application type.
4. Pro: Cost of Living Remains Competitive
While costs have risen in recent years, Portugal remains more affordable than most Western European countries. Housing, transport, and healthcare costs are lower, particularly outside Lisbon. Madeira stands out for providing excellent quality housing and infrastructure at competitive prices, often combined with spectacular sea views.
5. Pro: Stable, Secure, and EU-Compliant Jurisdiction
Portugal is a full member of the EU, OECD, and Schengen. Investors benefit from political stability, transparent administration, and access to the European single market.
Madeira’s autonomous government ensures efficient local administration and consistent support for international residents, reinforcing investor confidence.
6. Con: Bureaucracy and Administrative Delays
Although Portugal has improved its digital administration systems, some processes remain slow, particularly for renewing residence permits or registering for tax purposes.
Working with an experienced local representative — such as MCS — helps ensure accurate filings and smooth communication with authorities, avoiding unnecessary delays.
7. Con: Rising Housing Prices in Popular Areas
Demand from foreign buyers has pushed up housing prices in Lisbon, Porto, and the coastal Algarve.
However, Madeira offers more sustainable property values and a steady flow of new developments. For buyers seeking a lifestyle and value, the island provides a balanced property market, free from the intensity of the mainland’s larger cities.
8. Con: Language and Integration Challenges
English is widely spoken in major cities and Madeira’s urban areas. Yet, daily administration or legal matters often require proficiency in Portuguese.
Most expatriates adapt quickly, and local authorities encourage language learning through accessible public courses. Integration is easier in Madeira, where communities are welcoming and multilingual, making it a great place to live and work.
9. Con: Tax Complexity for International Income
Portugal taxes residents on their worldwide income, and coordination with foreign systems, especially those of the United States, can be complex.
Double taxation treaties, participation exemptions, and unilateral tax credits help reduce exposure, but careful planning is essential.
US citizens, for example, are required to continue filing annual IRS returns. Madeira Corporate Services assists expatriates in structuring compliant, efficient arrangements for income, investments, and business operations.
Balancing Lifestyle and Opportunity
Deciding whether to relocate depends on balancing lifestyle benefits with administrative and fiscal obligations. Portugal, and Madeira in particular, offers one of Europe’s most appealing combinations of climate, safety, and competitive taxation.
For individuals seeking residency, retirement, or business expansion within the European Union, the advantages often outweigh the challenges. By planning carefully and seeking professional guidance, expatriates can fully enjoy the benefits of life in Portugal’s most strategic region.
Madeira Corporate Services (MCS) offers comprehensive relocation, tax, and business support to foreign residents and investors.
The founding of Madeira Corporate Services dates back to 1996. MCS started as a corporate service provider in the Madeira International Business Center and rapidly became a leading management company… Read more
