D7 Visa vs Golden Visa in Portugal: Full 2021 Comparison

D7 Visa vs Golden Visa Portugal

Are you planning to emigrate to Portugal in 2021? Do you have a long-term goal of acquiring dual citizenship with Portugal? If so, it’s important to compare the different visa pathways available, namely the D7 visa vs Golden Visa in Portugal.

Portugal offers a range of visa-to-residency pathways for non-EU citizens. Two of the most popular are the D7 passive income visa and the Golden Visa. 

These two pathways have different requirements and what’s suitable for one person’s lifestyle may not be suitable for another’s. 

The D7 visa is also known as the passive income visa or retiree visa. It’s popular with remote workers and online entrepreneurs, as well as retirees. 

Importantly, the scope of the D7 visa goes beyond just passive income. You can apply for it using regular income from remote work contracts with employers from outside Portugal.  

On the other hand, the Golden Visa is for those who are ready to make a significant upfront investment in Portugal. In return, Golden Visa holders get a great deal of flexibility with residency requirements, while still being able to work towards citizenship.

Here, we compare the Portugal D7 visa and Golden Visa, including the process for getting each one, what they allow you to do once you’ve got them, and how they can be leveraged as part of your journey towards EU citizenship.

Check out our in-depth Golden Visa guide, including essential info on the upcoming 2022 changes.

D7 visa vs Golden Visa in Portugal

Portuguese citizenship

Both the D7 route and the Golden Visa route put you on a five year pathway to Portuguese citizenship. Once you’ve been resident for five years, you’ll be eligible to apply for citizenship. 

There are a couple of subtle differences to be aware of. Mainly, the need to show integration into the Portuguese community, a key requirement for gaining citizenship by naturalisation. 

Proving integration is more straightforward for those on the D7 route. Because they’re required to make Portugal their main home for five years, this naturally leads to a certain level of integration – usually sufficient for citizenship purposes. 

For the Golden Visa route proving sufficient integration is sometimes challenging, as the required time to be spent in country is much lower. 

If Portuguese citizenship is your goal with the Golden Visa, we recommend spending more time in Portugal than the minimum 7 to 14 days per year. 

There’s no hard and fast rule. But ideally you should demonstrate some interest in the country beyond just visiting for a few days a year. 

Portugal isn’t Malta; there’s no ‘cash for passports’. 

Applying for citizenship also means passing the CIPLE exam, which requires you to reach A2 level in Portuguese language

A2 is a fairly low level (A1 is the lowest), easily manageable within five years living in Portugal, hence less problematic for those on the D7 visa route. 

Those on the Golden Visa route who want citizenship should be aware of the language exam. They should take extra measures to reach the required A2 level, such as by taking an intensive study course in the final year before applying for citizenship. 

Physical presence requirements

There’s a big difference between the Golden Visa and D7 visa requirements in terms of physical presence for maintaining an uninterrupted timeline to citizenship.

Golden Visa holders have far more flexibility than D7s. They only need to spend a minimum of 7-14 days in Portugal per year for the full five years. 

As a Golden Visa holder, you could maintain your existing residency and keep your current job outside of Portugal. You could even pursue another citizenship pathway at the same time, such as the UK’s BNO (British Nationals Overseas) pathway for Hong Kong citizens.

With the Golden Visa, you don’t need to become a tax resident of Portugal, although you can if you wish. With Portugal’s NHR tax program, getting tax residency might be a smart move, depending on your circumstances. 

In contrast, D7 residents are required to make Portugal their main base. That means becoming a tax resident and spending at least 183 days in Portugal per year.

Income requirements

For the D7 route, you don’t need to make an investment in Portugal. Instead, you need to show proof of regular income, at least equivalent to the Portuguese minimum monthly wage (around 700 EUR).

If you want to bring family members with you, you need to add an extra 50% of the minimum monthly wage for an adult, and 30% for each child. 

To maximise the chances of your application being successful, we advise you to show proof of income beyond the minimum requirements. 

In contrast, Golden Visa holders need to make a large investment in Portugal. The exact sum varies depending on the chosen Golden Visa pathway (real estate, investment funds, cultural projects, or entrepreneurship). 

The lowest possible sum is 280,000 EUR, invested in support for art or maintaining national cultural heritage. But not many Golden Visa applicants use this option, as it’s very difficult to create a return on investment.

Realistically, you should anticipate investing at least €350,000, either in a Portuguese investment fund or to rehabilitate a property in a low density area. Other real estate options are available at a higher investment level.

For more details on the different Golden Visa investment pathways, and the upcoming 2022 changes, please see our full Golden Visa guide

Tax situation 

Both the D7 route and the Golden Visa route offer the option to apply for the non-habitual residence (NHR) tax scheme

If eligible for NHR, you’ll benefit from preferential tax treatment on your foreign-sourced income (and some kinds of Portuguese-sourced income) for a period of 10 years, starting from the date you become a Portuguese tax resident. 

Those on the D7 route need to make Portugal their main base, which involves becoming tax resident. That means you’ll need to apply for NHR by March 31 of the year after you register tax residency. So if you become tax resident in 2021, you’ll have until March 31, 2022 to apply. 

This March deadline is important: if you miss it, you’ll lose out permanently on NHR benefits.

NHR combines very nicely with a pathway to Portuguese citizenship, as the 10 year timeline easily covers the five years required to become eligible for citizenship. 

If you successfully gain Portuguese citizenship before your NHR status expires, you’ll have full EU rights. You can then choose either to continue living in Portugal under normal progressive tax status, or easily relocate elsewhere in the EU with freedom of movement. 

For Golden Visa holders, becoming tax resident in Portugal is optional but not required. 

If you take the Golden Visa route and decide to move to Portugal, you can start the NHR process once you register as a tax resident.

Golden Visa holders who are not resident in Portugal will only be liable for Portuguese tax on income from local sources, such as real estate rental income or sale of property. They don’t need to pay Portuguese tax on their worldwide income. 

Keen to learn more? Here’s our full guide to Portugal’s NHR tax program.

Application fees

The D7 route is the cheaper option of the two, both in terms of government application fees and legal costs. You’ll have to pay around €400 in government visa fees for a single applicant. If you want a lawyer to handle your application, typical legal costs start at around €2000. 

Golden Visa application fees, legal fees, and other associated fees will vary more widely according to which investment pathway you choose. Overall, the Golden Visa pathway will be a lot more expensive than the D7. 

Application process 

D7 visa application requirements

The D7 route has two important steps. Step One is getting the D7 visa. You do this by submitting your application at the Portuguese Embassy or consulate in either your country of citizenship or country of current legal residency. 

Once your application is accepted, the embassy will grant you an initial D7 visa. This visa is double-entry and valid for four months. With the D7 visa, you can enter Portugal and begin Step Two.

Step Two of the D7 process is where you apply for residency of Portugal. You do this via the Portuguese immigration office (SEF). Applying for D7 residency is part of the overall pathway, so it can only be done after entering Portugal on a D7 visa. You can’t apply while in Portugal under the 90/180 day tourist status. 

Once SEF approves your residency application, they’ll issue your residence card. This is usually valid for two years, at which point you’ll need to reapply. 

A successful D7 visa application requires you to have a number of things in place, which adds complexity to the process. 

First, you’ll need a Portuguese tax number (NIF). To get one as a non-EU citizen, you’ll also need a fiscal representative. 

Then, with the NIF, you’ll need to open a Portuguese bank account before applying for the initial D7 visa. This bank account is where you deposit the required funds for the application. Several banks offer the option of doing this remotely, while any lawyer can open an account on your behalf and also act as your fiscal representative. 

Having the bank account is essential, because the Portuguese government requires money to be held within Portugal before approving the D7 application. International bank accounts, such as TransferWise or Revolut, are not suitable for D7 visa applications. 

Navigating the accommodation issue

Lastly, you’ll need proof of accommodation in Portugal before applying. This often means renting or buying a home before applying for the visa. Obviously, this is an uncomfortable step to take when you’re uncertain if the visa will be approved.

We recommend two solutions. First, you can rent (or buy) with a promissory contract with a clause to protect you from any liability if the D7 visa is rejected. Second, if you already have friends legally resident in Portugal, you can ask them to prepare a statement to say that you live with them.

Our legal team has an excellent success rate in handling D7 applications. Done correctly, with clear proof of enough regular income, there’s no reason why your application should be refused.

For more on this option, here’s our ultimate guide to Portugal’s D7 visa

Golden Visa application requirements

So where does the Golden Visa stand in all of this? It’s much more flexible and has fewer upfront requirements. Once you’ve completed the initial investment, you will be awarded the Golden Visa. 

If you decide to make Portugal your main base under the Golden Visa (although this is an option, not a requirement), you can apply directly for residency with the SEF. You don’t need to provide proof of address in Portugal. 

The SEF will not refuse your Golden Visa residency application if you meet all the requirements. On the other hand, they can refuse a D7 residency application at their discretion (although it’s unlikely to happen).

Can I switch between the D7 and Golden Visa? 

A client asked us this recently, and the answer is yes…

Portuguese residency is very flexible. You can change your status if your circumstances change, for example, you get offered a job outside of Portugal. 

In this scenario, you could gain your initial residency under D7. Then you could make the required investment and switch over to Golden Visa status part-way through your citizenship timeline. 

Doing so would give you the flexibility to spend less time in Portugal, and relocate your tax residency away from Portugal, while still stacking up the years to become eligible for citizenship. 

Is the Portugal D7 visa or the Golden Visa right for me?

The D7 visa is right for you if: 

  • You have regular passive income
  • You don’t want to make a large investment upfront 
  • You’re a remote worker or online business owner
  • You plan to make Portugal your main base for the next five years 
  • You’re willing to become a tax resident of Portugal and pay tax on your worldwide income 

The Golden Visa is right for you if:

  • You’re able to make a significant upfront investment in Portugal 
  • You don’t (necessarily) want to become a tax resident of Portugal
  • You still wish to maintain a primary dwelling elsewhere, e.g. for family or work purposes 

Interested in exploring your Portugal options further? Schedule a free 20 minute consultation with our team.

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