PORTUGAL: An Introduction

Portugal’s Private Client Industry: Navigating Complexity in a Maturing Market

The Portuguese economy remains broadly stable despite continued inflationary pressures and an overheated housing market. The general elections held in May 2025 signalled a shift to the right, although a centre-right coalition ultimately retained power. Against this backdrop, Portugal continues to attract international wealth, albeit at a more moderate pace than in previous years fuelled by the NHR and Golden Visa and is steadily consolidating its private client industry.

Tax landscape

The end of the popular Non-Habitual Resident (NHR) regime marked a significant shift for private clients. The NHR, which offered generous tax breaks for foreign residents, closed to new applicants at the end of 2023 (with transitory regime still in place during 2024). In its place, the government introduced a more targeted incentive: the Tax Incentive for Scientific Research and Innovation (IFICI), regulated by Law 82/2023 and additional regulations published during 2024.

The new framework, often called NHR 2.0, offers a 20% flat income tax rate on active income coupled with a broad foreign income exemption for up to ten years but is limited to professionals in high-value sectors such as R&D, higher education, tech innovation, and administrative and certain financial services. This new special tax regime is slowly gaining momentum, attracting highly qualified individuals and investment into Portugal, and may position itself as an alternative to other regimes such as those in Italy, Spain, Greece and Switzerland.

Originally launched in 2019 and extended several times, Programa Regressar (Return Programme) remains another flagship policy aimed at reversing emigration by attracting Portuguese who have lived abroad. Updated in 2024, the programme offers a 50% exemption on active income for five years, now capped.

Trendy topics in private wealth

There are always topics that rise to the top of clients’ concerns: legal grey areas, emerging opportunities, or compliance risks that require proactive planning. We have selected five high-demand issues shaping private wealth discussions in Portugal, as follows.

• Forced heirship and the EU Succession Regulation – Portugal’s mandatory heirship rules are a critical concern for international families relocating or investing. With more high net worth individuals (HNWIs) owning assets across jurisdictions, cross-border estate planning has become essential, including the use of wills, life insurance and corporate vehicles to ensure testamentary freedom and tax efficiency.
• Unit-linked life insurance as a structuring tool – Portuguese-compliant life insurance contracts are increasingly popular among clients transitioning from the NHR regime or arriving from high-tax jurisdictions. Their strategic value lies in combining wealth protection, tax deferral, simplicity and multi-jurisdictional portability.
• Crypto-assets and taxation in Portugal – Portugal has emerged as one of the few EU jurisdictions offering a favourable tax environment for crypto-assets, particularly for private investors. With MiCA entering into force, private clients are increasingly seeking clear guidance on custody, succession and tax implications of their digital wealth.
• Foreign trusts and taxation – Foreign trusts are often a feature in the planning structures of inbound clients but Portuguese tax treatment is complex and evolving, demanding careful structuring.
• Dual residence and managing international tax exposure – With more mobile lifestyles and multi-jurisdictional connections, both individuals and family-owned companies face increased risk of dual tax residence or foreign management and control challenges.

Status of immigration

Residency-by-investment (via the so-called Golden Visa) continues to attract interest, though real estate has been fully excluded from the list of qualifying investments due to its role in housing market overheating. Instead, investment in qualifying investment funds has emerged as the preferred alternative. Other immigration routes such as D7 (own income visa) also continue to be in high demand.

According to the EU Directorate-General for Migration and Home Affairs, more than 1 million foreign citizens lived in Portugal in 2023, the highest figure ever recorded. Foreign residents now represent about 10% of the country’s total population. This increase in foreign residency has also led to a surge in applications for Portuguese nationality, which has become a strategic tool for many private clients. Despite backlogs caused by rising demand, the nationality process remains supported by updated legislation and digital systems.

Real estate continues its rise

Portugal remains one of the top destinations for high net worth individuals seeking relocation, so there is a thriving luxury real estate market, especially in Lisbon and the Algarve. Foreign investors accounted for a large part of Portugal’s total real estate investment.

In an effort to cool the housing market, Portugal has enacted a favourable tax framework for alternative investment vehicles and real estate collective investment structures, aimed at fostering rental supply and affordable housing. In addition, new youth-focused housing policies to support younger generations in acquiring property allow young homebuyers under the age of 35 to benefit from significant exemptions from property transfer taxes, alongside a government-backed mortgage guarantee scheme. These policies enhance access to property and are becoming tools for succession and estate planning among younger clients.

Developments in private wealth industry

Portugal’s private wealth sector is entering a new phase of consolidation and institutional maturity, shaped by evolving client demands, regulatory changes and global trends. Three interconnected forces are redefining the landscape.

• Post-NHR market: the rise of an institutional ecosystem – The decade-long success of the NHR regime positioned Portugal as a top destination for international wealth. In its wake, the country has attracted a growing infrastructure of private banks, multi-family offices, tax boutiques, co-investment platforms, and private and venture funds. These players are now staying for long-term market consolidation. No longer just a landing point for individual HNWIs, Portugal is increasingly a hub for professionalised private wealth services.
• International families, multi-jurisdictional challenges and wealth transfer – As more international families settle in or engage with Portugal, the industry is managing increasingly complex cross-border issues. The looming intergenerational wealth transfer from the baby boomer generation has further elevated the need for strategic, long-term planning. Portuguese advisers are now expected to operate in tandem with professionals abroad, offering solutions that work across borders.
• Regulatory scrutiny, compliance culture and multidisciplinary advice – Portugal is aligning with global transparency and compliance standards, with growing scrutiny across tax, financial, corporate and banking frameworks. As a result, family offices, law firms and tax advisers are increasingly engaged in maintaining robust compliance infrastructure. A key development enabling this evolution was the operationalisation of multidisciplinary professional law firms, which will allow for high-quality advisory models necessary for the complexity of modern wealth management.

Outlook

Portugal’s private client sector is shifting from a phase of rapid growth to a more mature and strategic era. Geopolitical instability will continue to drive HNWIs and family offices towards safe, stable jurisdictions, making Portugal an attractive destination.

Even in the post-NHR landscape, Portugal retains its appeal. The first years of the new IFICI regime (NHR 2.0) will be key in defining how international clients adapt and engage with the country under this updated framework.

Portugal is also well-positioned to support and benefit from the ongoing intergenerational wealth transfer, with a growing ecosystem of advisers ready to deliver long-term, cross-border solutions. The market is now defined by a stronger risk management mindset, with legal, tax, regulatory and operational perspectives working in tandem to meet the rising complexity of client needs.