To begin with, it should be made clear, buying property in Portugal after Brexit is certainly possible. Despite the fact that we deep into Brexit “territory”; more than 3 years after the referendum that decided Brexit, the United Kingdom left the European Union (EU) on 31 January 2020, after which the Exit Agreement negotiated between London and Brussels entered into force, initiating a transitional period whose term ended on 31 December 2020. As a result, besides seeing an end to UK citizens’ automatic right to residence in EU countries, it changed holiday home owners’ tax liabilities.
However, one thing will be unchanged: there will be no restriction on buying or owning a property as Portugal has not imposed restrictions on individuals of any nationality owning property, though it does have higher rates of property taxes imposed on owners who are resident in specified tax havens – thus driving up the costs of buying property in Portugal. To overcome this problem, some law firms are suggesting to British nationals that the Golden Visa may be a solution for them. However, this may not be correct…
Buying Property in Portugal after Brexit vs Golden Visa
On 22nd December 2020, Portugal’s Cabinet approved an amendment which changed the parameters of where investors can purchase property to qualify for the Golden Visa residency program.
The measure has been approved in December 2020 but will not take effect until July 2021, to allow for a transition and adaptation period.
At the moment it is certain that the Golden Visa will be prohibited from being used where the property is purchased in big cities like Lisbon and Porto and probably in more densely populated areas elsewhere in the country, including some of the Algarve.
So, if you want to buy property in any of these locations, a Golden Visa is no longer the answer for you.
In any case it looks likely that Portugal will introduce relatively relaxed arrangements for residence. Antonio Costa, the Portuguese PM, has said he will ensure that the rights of British citizens who live or invest in Portugal will be respected. Portugal’s links with Britain go back a long way – to the Treaty of Windsor in 1386, long before the EU was thought of – and Costa also knows that the Portuguese economy depends on tourism and construction, particularly in areas like the Algarve.
Pending concrete measures, British nationals will be treated the same as Americans, for instance. They will need to get a residential visa and all they need to do for this is provide proof of income to support themselves and a residential address, either by buying a property or by signing a residential rental agreement.