How to Choose Between Spain and Portugal If You Want to Live in Europe: Residency, Taxation, and Strategy

Published: June 25, 2026

The decision that combines mobility and taxation

Spain and Portugal are the two European destinations most frequently considered by those looking to relocate outside their country of origin. The rules applicable to each have changed significantly over the past two years.

Before comparing the programs in detail, it is important to establish the regulatory context for 2026. Spain abolished its Golden Visa program on April 3, 2025. Since that date, no new applications have been accepted, although those who obtained the visa before that date retain the right to renew it in accordance with the regulations in effect at the time of the initial grant. Portugal, on the other hand, continues to operate its Investment Residency Program (ARI) through investment funds, with a threshold of €500,000 and oversight by the CMVM.

In terms of taxation, Spain maintains its expat tax regime—the so-called “Beckham Law”—which remains relatively accessible and is designed for high-income earners, while Portugal replaced its former NHR with the IFICI, a much more restrictive incentive aimed at specific professional profiles. And regarding citizenship, the 2026 Portuguese reform significantly tightened the general requirements, bringing the Portuguese system closer to the Spanish model of naturalization through residency.

1. Pathways to Residency: Which Doors Are Still Open and Which Have Closed

Spain: The End of Real Estate Investment and the Strengthening of Income and Employment Opportunities

The elimination of the Golden Visa leaves Spain with a range of options focused on income, employment, and entrepreneurship, rather than on pure asset investment. The Non-Lucrative Visa remains the go-to option for those who have sufficient savings, income, or pensions and do not need to work in Spain. Alongside it, the visa for international remote workers (digital nomads) and the visa for highly qualified professionals offer alternatives for individuals who do engage in economic activity.

Portugal: Investment Remains Strong, and the D7 Index Holds Above a Lower Threshold

Portugal has not closed the door on residency-by-investment programs. The ARI, through funds regulated by the CMVM, remains a viable option for those who prefer to maintain an asset-based approach, with a minimum stay requirement of just 7 days in the first year and 14 days every two years, making it suitable for those who do not wish to immediately relocate their daily lives to Portugal. For those who do seek to reside in Portugal on the basis of passive income, the D7 visa maintains an income threshold significantly lower than that of the Spanish Non-Lucrative Visa, although it requires stricter proof of the foreign origin and stability of that income.

2. Taxation: The Real Turning Point Between the Two Countries

If the decision depended solely on the visa, many cases would be resolved relatively quickly. The real complexity arises when the tax variable is introduced, because Spain and Portugal have taken different approaches to their tax regimes for expatriates.

Spain: The Beckham Law, a Comprehensive and Well-Established Framework

The special regime for impatriates, governed by Article 93 of Law 35/2006 on Personal Income Tax, allows individuals who transfer their tax residence to Spain to be taxed as non-residents during the year of arrival and the following five years. Law 28/2022 on the promotion of the startup ecosystem significantly expanded the scope of this regime: today, it applies to employees seconded by their companies, executives, highly qualified professionals, entrepreneurs, and directors of Spanish companies (meeting certain criteria), as well as digital nomads under certain conditions.

The main benefit is a flat rate of 24% on earned income up to €600,000 per year (47% on the amount exceeding that threshold), as opposed to a general progressive tax scale that can reach up to 52% in the highest brackets, depending on the autonomous community of residence. Equally important is that, by being taxed under non-resident income tax rules, a large portion of the taxpayer’s foreign-source income—dividends, rental income, capital gains, and interest earned outside Spain—is not subject to Spanish taxation for the duration of the regime, nor is their wealth located outside Spanish territory. The eligibility requirement is that the taxpayer must not have been a tax resident in Spain during the previous five fiscal years, compared to the ten-year requirement under the regulations in effect prior to 2023.

Portugal: From the Classic NHR to the IFICI, a More Restricted Incentive

As of January 1, 2024, the former Non-Habitual Resident regime ceased accepting new applications and was replaced by the IFICI (Tax Incentive for Scientific Research and Innovation), as provided for in Article 58.of the Statute on Tax Benefits (EBF), introduced by Law 82/2023 (State Budget for 2024) and implemented by Ministerial Order 352/2024/1. The fundamental difference goes beyond just the name: the classic NHR was a broad scheme that benefited a wide range of professions, whereas the IFICI is specifically aimed at researchers, university professors, highly qualified professionals in strategic sectors defined by the government, and employees of startups or recognized R&D companies, and also requires a university degree.

Those who meet the requirements are subject to a flat rate of 20% on qualified income from employment or self-employment derived from Portuguese sources, as opposed to the general IRS tax bracket, which ranges from 13.25% to 48%. Contrary to what one might think, the IFICI does provide broad exemptions for foreign-source income—including dividends, interest, rent, and capital gains—similar to the former NHR. The real exception lies in foreign-source pensions, which do not enjoy any benefits under the IFICI (they are taxed according to the general rules, unlike the fixed 10% rate applied by the classic NHR), and on income from countries or territories considered tax havens by Portugal, which is taxed at the surtax rate of 35%. The regime has a maximum duration of ten years, is non-renewable, and must be applied for with the Autoridade Tributária within the legal deadline, typically by January 15 of the year following the acquisition of tax residency.

In practice, this means that a qualified professional who falls into the Portuguese strategic categories may find a real advantage in the IFICI, but that a rentier, a passive investor, or a professional outside those categories will likely not be eligible for any special tax regime in Portugal and will be taxed from the first year according to the general IRS tax scale.

3. Nationality: The Area That Has Changed the Most in 2026

Until a few years ago, Portugal offered a clear advantage over Spain in terms of naturalization timelines. The reform of the Portuguese nationality law passed in 2026 eliminated the possibility of naturalization after five years and established a general rule requiring ten years of legal residence, with a reduced period of seven years for nationals of European Union member states and countries of the Community of Portuguese-Speaking Countries (CPLP).

Spain, for its part, maintains its general ten-year rule but retains several particularly relevant cases where the period is shortened. In particular, it allows individuals who have been married to a Spanish citizen for at least one year—and are not legally or de facto separated—to apply for citizenship after just one year of legal residence. In addition, it maintains the reduced two-year period for nationals from Ibero-American countries, Andorra, the Philippines, Equatorial Guinea, and Portugal, as well as for those who can prove Sephardic descent.

For Latin American clients—who make up a significant portion of the international mobility practice—this difference remains decisive: In certain cases, Spain offers a significantly shorter path to citizenship than Portugal following the 2026 reform, especially when the client has an Ibero-American nationality of origin or a marital relationship with a Spanish citizen.

So, what’s the best strategy?

There is no one-size-fits-all answer. The decision depends on a combination of the individual’s type of income, country of origin, net worth, and plans for economic activity.

Conclusion: The choice between Spain and Portugal is not based on intuition, but on regulatory fit. With the Spanish Golden Visa program eliminated, the Portuguese IFICI program restricted to very specific profiles, and Portuguese citizenship requirements set to become stricter in 2026, the factors that previously seemed stable have changed simultaneously in both countries.

At Gentile Law, we analyze each case from both an immigration and tax perspective before recommending a specific course of action.

If you need help or advice on this matter, at Gentile Law we have a team of experts in this field ready to assist you.

Contact us:

Lais Verissimo Galvan

Global Mobility Paralegal at Gentile Law

laisverissimo@gentile.law

+34 684 46 37 36

Santiago Andrés Randazzo Clavijo

Global Mobility Legal Advisor at Gentile Law

santiagorandazzo@gentile.law

+34 684 46 30 82

Ana García Ginés

Tax Associate at Gentile Law

anagarcia@gentile.law

+34 604 512 160

This publication is for informational purposes only and should not be construed as legal advice.