If you are considering moving to or basing yourself in Portugal, you may have come across two popular paths: The D7 visa and the Golden Visa.
The D7 (or passive income) visa is mostly targeted to retirees and people living off their own foreign income (investors, freelancers, remote workers) who want to live in Portugal full-time.
The Portuguese Golden Visa provides a path to residency through investment and does not require you to live in Portugal most of the year.
Both options give the right to apply for permanent residency or citizenship in Portugal after 5 years. Which is the better way for individual purposes depends on several factors. If you would like to consult an expert, we have compiled a list of the most popular law firms in Portugal among our readers.
Now, let’s take a closer look at which route could be a better fit for you!
The application process
The D7 visa is a two-step process.
First, you need to apply to the Portuguese Consulate or Embassy in your home country. They will issue the initial visa.
Besides providing the usual suspects of supporting documentation (such as proof of income and a clean criminal record), you’ll also need a Portuguese bank account and proof of long-term accommodation in Portugal. In practice, this means you’ll most likely need to sign a lease or purchase property in Portugal even before applying for the initial visa.
Once your application is approved, you’ll be issued with a 4-month, double-entry visa to Portugal.
Second, once in Portugal, you need to apply for the actual residence permit from SEF (the Portuguese foreigner and border service) and provide additional documentation. You can only do this while entering Portugal on the D7 visa, not if you enter as a tourist.
Once (and if) your residency permit is approved, you’ll be issued a residence card valid for two years, after which it needs to be renewed.
The most complicated part is that D7 requires you to have a bank account and show proof of home in Portugal before even getting the visa (which you will apply for in your home country). Unless you have friends in Portugal, who can issue a statement that you live with them, you’ll have to buy or rent a property before applying for the visa as well.
Some landlords, particularly in more touristic areas like the Algarve may be willing to sign a side contract so they can rent it out when you are not there. That way they win too and can earn a bit of extra cash instead of leaving it empty for several months. It’s a bit of a hack but we’ve heard from expats in Portugal that this arrangement is not uncommon.
With the Golden Visa, you can apply directly for residency without an interim step. There’s no need to provide any proof of address in Portugal. The specific process is outlined here.
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Required time spent in Portugal
The D7 residence permit holder needs to spend most of their time in Portugal. Specifically, they are only allowed to leave for six consecutive or eight non-consecutive months within the validity of their residency permit. The first permit is issued for two years, and each following permit is issued for three years.
Holders of the Golden Visa, only need to spend an average of seven days in Portugal per year.
Required income or investment
D7 visa path does not require you to make an investment in Portugal, but you have to show proof of income.
Minimum monthly income needs to be at least equivalent to the Portuguese minimum wage. In case your application includes other people, you need to calculate an additional 50% for adults and 30% for children (under 18 years old). However, it’s not uncommon that applications are denied when only meeting the minimum requirement, so it is safer to demonstrate passive income of at least twice the minimum requirements.
Consulates accept a combination of salary, pensions/benefits, and investments (including net real estate income). Income must be regular, documented, and easy to understand for consular staff.
The Golden Visa requires an investment of at least €250,000 (more commonly €350,000 or €500,000). The most popular options are real estate and investment funds, but you may also invest in art or start a local business employing at least 10 people.
Costs of the process
The D7 visa is definitely the cheaper option out of the two, with government fees of about 400 euros per single applicant.
For the Golden Visa, the total costs vary depending on the specific investment route selected, but they will be significantly higher in any case.
On either of these, you can also apply to become a non-habitual resident for tax purposes, which gives tax benefits on foreign (and certain types of Portuguese) income for a 10-year period.
Since the D7 visa requires you to stay in Portugal most of the year and maintain a home in Portugal, you’ll also necessarily become a tax resident. This means you’ll have to apply for the NHR by March 31st of the year following your arrival.
With the Golden Visa—since you don’t have to move to Portugal—you can choose to start the NHR clock later, if and whenever you eventually move to Portugal.
Golden Visa holders who never actually move to Portugal never become tax residents and will only be liable for Portuguese tax on local sources (such as real estate investments).
So which one is better for me?
Both of these residence permits give you the right to live, invest, and work in Portugal.
The D7 visa works well for someone who wants to move to Portugal immediately to live there on a nearly full-time basis and are fairly certain that they would like to live in Portugal for at least the next 5-6 years (if they want to gain citizenship).
If you want to gain Portuguese and EU residency without necessarily moving full time (yet or at all), the Golden Visa is the way to go. It’s also a better option if you plan on moving full time to Portugal in the future and want to start the clock towards permanent residency or citizenship already now.
The process itself is somewhat more complicated for the D7 route, as you need a visa first from a consulate in your own country before you can go to Portugal for your SEF interview. Also, you need a Portuguese bank account and proof of home before you even start the application. On the other hand, the D7 visa is a less costly option.
Another important difference to keep in mind: SEF must approve your application if you meet all the Golden Visa requirements (including the background check). With the D7 residence visa, they have discretionary power about the approval of your application.
I hope you found this short comparison helpful.
Please let me know in the comments below if you have any unanswered questions.
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