Buying Property in Portugal as an American vs. a UK Citizen (Post-Brexit)

US citizens and Brits (post-Brexit) now face very similar rules when buying property in Portugal - especially regarding visas and financing. We explore this new landscape and the crucial tax differences that still separate American and UK buyers.

US and UK citizens can both buy property freely in Portugal, but key differences exist in financing options, visa requirements, and tax considerations for each group. 

Financing Options

After Brexit, UK citizens are now treated as non-EU/EEA residents, making their financing process very similar to that of US citizens. [3]

• US Citizen: As a non-EU buyer, a US citizen can obtain a mortgage from a Portuguese bank but typically faces stricter criteria, lower loan-to-value (LTV) ratios (often 60–70%), and higher down payments (at least 30–40% of the purchase price). 

• UK Citizen: Lending terms are now similar to those for US buyers. There is generally no advantage for UK buyers, though some banks may be more accustomed to UK applicants due to historical volume. [3]

Both nationalities will require documentation of income/assets, a Portuguese tax number (NIF), and a local bank account to secure financing.

Visa & Residency Implications

This is the most significant change for UK citizens. Since Brexit, UK buyers face the same rules as Americans. [2][3]

Simply buying property does not confer residency or a right to live in Portugal for either group.

Both US and UK citizens must apply for a visa—such as the D7 (passive income), Digital Nomad, or Golden Visa—if they want to reside in Portugal or spend more than the 90-day per 180-day Schengen limit. Prior to Brexit, UK citizens could move freely under EU rules; this is no longer the case. 

Tax Treatment

This is where the most significant differences remain between the two nationalities.

• US Citizen: US citizens are taxed on their worldwide income regardless of where they live. They must declare any Portuguese rental income or capital gains to the IRS. They may qualify for foreign tax credits to avoid double taxation. Property ownership also incurs IMI (municipal tax) and potentially AIMI (wealth tax). 

• UK Citizen: A UK citizen's tax requirements depend on their residency status. If they remain resident in the UK, their worldwide income is subject to UK tax. However, once a UK citizen establishes residency in Portugal, their liability on Portuguese property income is governed by Portuguese law. Notably, new residents may be able to benefit from Portugal’s NHR (Non-Habitual Resident) scheme for the first ten years. [3]

Tax treaties exist between both the US and UK with Portugal to help avoid double taxation, but compliance in both systems is essential. 

Summary Table:

Both nationalities can access Portugal’s property market freely, but must plan closely for financing, visa/residency, and dual tax compliance.