The 34.6% increase was revealed by the latest Immigration, Borders and Asylum Report for 2020 from Portugal’s borders and immigration service, SEF.
Several factors have played into the increase, from Brexit to Portugal’s non-habitual resident tax scheme, which allows many foreigners (including Brits) who move to Portugal to benefit from huge reductions in their income tax bills.
The non-habitual resident tax incentive was introduced in 2009, exempting individuals with certain sources of income from overseas (including pensions) from paying tax on that income. In its 2020 budget, Portugal replaced the exemption with a 10% tax rate – still well below what would be payable in many other countries.
Christina Hippisley, General Manager of the Portuguese Chamber of Commerce in the UK said: “Portugal’s lifestyle benefits have long made it an attractive destination for British retirees and we’ve seen a notable increase in those looking to enjoy their retirement here over the past few years. The affordability of life in Portugal and the longer life expectancy here both play into this. At the same time, we’ve seen a rising number of younger families moving to Portugal, attracted by the country’s excellent international schools, laid back pace of life and – for many – its location within the Schengen Zone.”