D7 vs D8 Visa Portugal: Comparing the Passive Income and Digital Nomad Visas

If you are considering retiring in Portugal or living there as a digital nomad, you may want to explore the Portugal D7 Passive Income visa or the D8 Digital Nomad Visa. Both visa options allow you to enjoy Portugal’s beautiful landscapes, access the Schengen area, and potentially become a Portuguese citizen.

In this comprehensive guide, we will explore a detailed comparison of the D7 and D8 Visa, covering essential aspects such as:

• Eligibility criteria and required documents
• Application processes and processing times
• Associated Costs
• Tips on selecting the right visa path

Passive Income vs Digital Nomad Visa Portugal

What is the D7 Portugal Visa?

Introduced in 2007, the Portugal D7 Visa to non-EU/EEA and non-Swiss citizens wishing to establish residency in Portugal. Also known as the Portugal Retirement Visa, it is designed for individuals who can demonstrate a stable source of passive income, which must come from abroad, such as pensions, rental income, or investments, rather than from employment within Portugal.

The primary advantage of the D7 Visa is that it provides a pathway from temporary to permanent residency in Portugal for those who meet the income requirements. By offering this option, Portugal aims to attract retirees and individuals with secure financial resources who seek to enjoy the country’s high quality of life, low cost of living, and scenic beauty.

What is the D8 Visa Portugal?

The D8 Visa, also known as the Portugal Digital Nomad Visa, is a residency permit introduced to accommodate remote workers and digital nomads who wish to live in Portugal while maintaining employment or business activities abroad.

Unlike other visa types, the D8 Visa is tailored for non-EU/EEA and non-Swiss citizens who work remotely for companies outside Portugal or run their own businesses.

The D8 Visa Portugal provides a unique opportunity for digital nomads and remote workers to settle in Portugal temporarily, with the possibility of extending their stay or transitioning to permanent residency. To qualify, applicants must demonstrate that they have a reliable source of income and that their work does not involve employment within Portugal.

Portugal offers two distinct categories for its Digital Nomad Visa, catering to different needs and durations of stay. The Short Stay Visa is designed for remote workers who wish to experience Portugal temporarily. This visa allows you to stay in the country for up to one year and explore Portugal’s vibrant lifestyle while working remotely.

The residency permit (or Long-Stay Visa) is ideal for those looking to settle in Portugal for a more extended period. Initially valid for two years, this permit can be renewed for three more years.

After five years of holding this visa, you may be eligible to apply for permanent residency and Portuguese citizenship, provided you meet the requirements, including passing a basic Portuguese language test and maintaining a clean criminal record. Additionally, opening a Portuguese bank account is necessary for the residency permit process.

D7 vs D8 Visa Portugal Key Differences

D7 vs Digital Nomad Visa Eligibility Comparison

D7 Visa eligibility criteria

1. Stable Passive Income: Applicants must prove a steady source of passive income, such as pensions, rental income, or dividends, sufficient to cover living expenses in Portugal.
2. Minimum Income Requirement: Generally, applicants need to show an income above the Portuguese minimum wage. A monthly income of around €1,200 to €1,500 is often considered adequate.
3. Proof of Accommodation: Evidence of suitable accommodation in Portugal is required. This can be a rental agreement, property ownership documents, or a host’s letter.
4. Health Insurance: Valid health insurance covering medical needs in Portugal must be provided. It should meet Portuguese standards.
5. Criminal Record Check: A clean criminal record from the applicant’s home country or recent countries of residence is needed to ensure good character.

Digital Nomad Visa eligibility criteria

1. Stable Remote Income: Show a reliable income from remote work or freelance activities to supports their stay in Portugal.
2. Minimum Income Requirement: Generally, a monthly income of around €3,280 is required, though this amount can vary depending on individual circumstances and consular requirements.
3. Proof of Accommodation: Evidence of accommodation in Portugal is necessary. This can include a rental agreement, property ownership, or a host’s letter confirming your address.
4. Health Insurance: Valid health insurance that covers you in Portugal must be provided
5. Criminal Record Check: A clean criminal record from your home country or recent country of residence.

D7 vs D8 Visa Required Documents

D7 Visa required documents

• Proof of Income: Documentation such as bank statements, pension statements, or rental agreements showing stable and adequate income.
• Accommodation Proof: A rental contract, property ownership documents, or a host’s confirmation letter indicating the address and suitability of accommodation.
• Health Insurance Policy: A valid health insurance policy covering the applicant in Portugal, meeting local requirements.
• Criminal Record Certificate: An official certificate or police clearance from the applicant’s home country, translated into Portuguese if necessary.
• Valid Passport: A passport with at least six months’ validity beyond the intended stay in Portugal and enough blank pages.
• Completed Application Form: The completed D7 Visa application form with personal details, proof of payment and other information that may be required for the Portuguese consulate.

D8 Visa required documents

• Proof of Remote Work Income: Documents such as contracts, bank statements, or invoices showing a stable and sufficient income from remote work.
• Accommodation Proof: A rental contract, property ownership documents, or a host’s confirmation letter with your address in Portugal.
• Health Insurance Policy: A health insurance policy that covers medical needs in Portugal.
• Criminal Record Certificate: An official certificate or police clearance from your home country, translated into Portuguese if necessary.
• Valid Passport: A passport with at least six months’ validity beyond the intended stay in Portugal.
• Completed Application Form: Completed D8 Visa application form with personal details and other required information.

D7 vs D8 Visa Family Reunification

When relocating to Portugal under the D7 Passive Income Visa or the D8 Digital Nomad Visa, bringing your family along is a significant consideration. Both visa types allow for family reunification with specific requirements and processes.

Comparing the D7 vs Digital Nomad Visa Application Process

D7 Visa application process

1. Gather Documentation: Prepare all required documents, ensuring they are up-to-date and meet Portuguese standards.
2. Submit Application: Submit the application form and documents to the Portuguese consulate or embassy in your home country.
3. Attend an Interview: An interview at the consulate may be needed to discuss your application and clarify any details.
4. Processing Time: The processing time can range from several weeks to a few months, during which your application will be reviewed.
5. Receive Visa: If approved, you’ll receive the D7 Visa to enter Portugal. Schedule an appointment with AIMA upon arrival to finalize your residency permit.

Portugal’s Digital Nomad Visa application process

1. Gather all required documents and submit application
2. Attending an interview at the consulate may be required
3. Processing time: Processing times typically range from a few weeks to a couple of months, during which your application will be reviewed.
4. Receive visa: If approved, you’ll receive the D8 Visa to enter Portugal. Schedule an appointment with AIMA upon arrival to finalize your residency permit.

Tax Implications for D7 and D8 Visa Holders

As of January 1, 2024, significant changes in Portugal’s tax regulations impact holders of both the D7 and D8 visas, primarily due to the phase-out of the Non-Habitual Resident tax regime (NHR).

For D7 Visa Holders

Income tax

Previously, the NHR regime offered substantial tax benefits to new residents, including favorable rates on specific income types and exemptions on foreign income.

However, with the transitional regime now in effect, new applicants who did not secure their NHR status but qualify, may do so until 31 March 2025.

Instead, D7 visa holders are now subject to Portugal’s standard income tax rates, which are progressive and range from 14.5% to 48%, depending on income levels. This change means that all income from pensions, investments, or other passive sources will be taxed according to these standard rates.

Social security contributions

D7 visa holders typically do not have social security obligations unless they engage in business activities or self-employment. However, those involved in any form of active work must contribute accordingly.

For D8 Visa holders

Income tax

The cessation of the NHR regime also affects D8 visa holders, who often work remotely or freelance. Under the former NHR regime, they benefited from reduced tax rates on certain types of income and exemptions on foreign-sourced income.

With the new regulations, D8 visa holders are subject to Portugal’s progressive tax rates, like D7 holders. Income tax now ranges from 14.5% to 48% based on the total income earned from Portuguese and international sources.

Social security contributions

D8 visa holders must contribute to Portugal’s social security system based on their income from remote work or freelance activities. These contributions are mandatory and are calculated based on the income reported, covering health, retirement, and other social benefits.

Choosing the Right Visa: Factors to Consider

When deciding between the Portugal D7 Passive Income Visa and the D8 Digital Nomad Visa, it’s crucial to consider how each visa aligns with your personal circumstances and long-term goals in Portugal. Here are the key factors to weigh:

Type of Income and employment flexibility

The D7 Visa is perfect for retirees or individuals with steady passive income, allowing them to live in Portugal without local employment. Conversely, the D8 Visa is tailored for digital nomads and remote workers who need to prove ongoing remote work, providing the flexibility to work while residing in Portugal.

Financial requirements

The D7 Visa requires stable passive income to support yourself, without permitting local work, ideal for those with investments or retirement funds. The D8 Visa requires proof of active income from remote work, with a minimum threshold of approximately €3,280 per month for the first 3 months, suited for those who work remotely and seek flexibility.

Path to permanent residency and citizenship

Both visas provide a pathway to permanent residency after five years of legal residence in Portugal. The D7 Visa might be more straightforward for those seeking a long-term stable living situation without the necessity of ongoing work, while the D8 Visa aligns well with those who intend to remain active in their professional life.

Family reunification

The D7 Visa generally provides an easier path for family reunification, requiring proof of adequate income to support dependents. The D8 Visa also permits family reunification but involves more stringent requirements and paperwork to prove financial support through remote work income.

Tax considerations

With the recent end of the Non-Habitual Resident (NHR) regime as of January 1, 2024, it’s essential to understand the current tax implications for a potential tax resident. The D7 Visa holders will need to navigate the new tax landscape without the benefits previously offered by the NHR. The D8 Visa may also face changes, so understanding how the new tax policies affect your situation is crucial.

D7 Passive Income Visa vs the D8 Digital Nomad Visa: Which One is Better?

Choosing between Portugal’s D7 Passive Income Visa and the D8 Digital Nomad Visa depends on your income sources and lifestyle preferences. The D7 Visa requires stable passive income to support yourself.

While not necessary, work is permitted for D8 holders, but they must prove that they have the minimum required passive income.

The D8 Visa is ideal for those with investments or retirement funds.  The D8 Visa requires proof of active income from remote work, with a minimum threshold of approximately €3,280 per month.

The purpose of both visas is also different. The D7 Visa is ideal for retirees or individuals with stable passive income, allowing them to live in Portugal without engaging in local employment.

In contrast, the D8 Visa is tailored for digital nomads or remote workers. This option is better for those seeking employment flexibility while living in Portugal.

According to our Global Intelligence Unit’s report on digital nomads, Portugal ranked 7th, thanks in part to the longevity of the visa, as with other countries.

Of the 65 jurisdictions researched, three grant direct access to citizenship for time spent as digital nomads (Spain, the Netherlands and Czechia), while 15 offer pathways to permanent residency, paving the way to eventual citizenship. This is particularly relevant for individuals from countries with weaker passports, as they can use digital nomadism as a strategy to acquire a second citizenship and enhance their international mobility. – Global Intelligence Unit, Global Digital Nomad Report (2024)

Both visas can lead to permanent residency and citizenship after five years, but the D7 is more convenient for individuals focusing on a stable lifestyle, while the D8 fits those who wish to continue working remotely.

Family reunification is generally easier under the D7, with less stringent requirements than the D8, which demands more proof of financial support.

Why choose Global Citizen Solutions for your Immigration Visa?

GLOBAL APPROACH BY LOCAL EXPERTS

• GCS has offices located across Portugal.
• Members of the US-Portugal and UK-Portugal Chambers of Commerce in Portugal, and the Investment Migration Council (IMC).
• Our expert team can help you throughout your journey to secure your Visa. 

100% APPROVAL RATE

• Our successful track record in applications provides reassurance to applicants. 
• We have helped clients from more than 35 countries secure residency in Portugal.

ALL-ENCOMPASSING SOLUTION

• With a single channel of communication, our approach ensures that you have complete clarity on your application. 
• Our BeGlobal® Onboarding System allows for a total flow of information.

TRANSPARENCY AND PRIVACY

• Our pricing is clear and detailed, you will not face any hidden costs.
• All data is stored within a GDPR-compliant database on a secure SSL-encrypted server.

FAQs

What are the disadvantages of the D7 Visa in Portugal?

The D7 Visa requires proof of a stable and sufficient passive income, which may be difficult for some applicants to meet. It does, however, allow professional activity.

The application process can be lengthy and requires substantial documentation. Additionally, it may not offer the same flexibility as other visa types.

What is the minimum income requirement for the D7 and D8 visas?

For the D7 Visa, the minimum income requirement is approximately €820 per month.

For the D8 Visa, applicants must demonstrate an income of around €3,280 per month from remote work or freelance activities. These amounts are subject to change and may vary with dependents.

Can I bring my family to Portugal under the D7 and D8 visas?

Yes, both the D7 and D8 visas allow family reunification. You can bring your spouse and children, provided you can prove sufficient income to support them. Specific documentation and financial requirements apply to both visa types.

What are the tax benefits for D7 and D8 visa holders?

D7 visa holders previously benefited from the Non-Habitual Resident (NHR) tax regime, but this regime is ending.

D8 visa holders might qualify for the NHR or the new Fiscal Incentive for Scientific Research and Innovation (IFICI) Program, depending on current regulations.

Both visa holders need a Portuguese bank account and a Portuguese tax identification number to manage taxes and financial affairs.

Digital nomads on the D8 visa should be aware of their average monthly income and meet residency requirements to be recognized as tax residents by Portuguese authorities.

Can I apply for permanent residency or citizenship with the D7 and D8 visas?

Yes, both the D7 and D8 visas can lead to permanent residency or citizenship. After five years of residency, visa holders can apply for permanent residency.

Citizenship can be pursued after five additional years, subject to meeting specific requirements.

What's the difference between a digital Nomad Visa and Golden Visa?

Digital Nomad Visas are for individuals who work remotely and want to live in a country while maintaining their remote employment.

This visa requires proof of ongoing remote work and a stable income. The Golden Visa, on the other hand, is a residence-by-investment program for those making substantial financial investments, such as real estate or business investments.

It provides a pathway to residency or citizenship and typically has fewer restrictions on employment or income sources.