US Citizens Working in Portugal
See what you actually take home after US and Portugal taxes — whether you're already working abroad or planning a move.
Here's what matters most for US citizens working in Portugal:
- •Portugal has progressive income tax rates up to 48%
- •FEIE can exclude up to ~$126,500 from US taxation if you meet the physical presence test
- •Non-Habitual Resident (NHR) program may offer tax benefits for qualifying expats
- •Cost of living in Portugal is lower than most Western European countries
Who taxes you?
As a US citizen working in Portugal, you're subject to taxation by both countries. The US taxes citizens on worldwide income, but the Foreign Earned Income Exclusion (FEIE) can exclude up to approximately $126,500 of foreign earned income if you meet the 330-day physical presence test. Portugal taxes residents on Portuguese-sourced income with progressive rates up to 48%. The Non-Habitual Resident (NHR) program may offer reduced tax rates for qualifying expats, but this program is being phased out. The US-Portugal tax treaty provides foreign tax credits to prevent double taxation.
Common pitfalls
- Portuguese tax rates are high, with top marginal rate of 48%
- NHR program benefits are being phased out for new applicants
- Not meeting the 330-day physical presence test disqualifies you from FEIE
- State tax obligations may persist if you maintain US state residency
- Currency fluctuations between USD and EUR can impact your effective income
Frequently asked questions
Yes. US citizens must file US tax returns regardless of where they live. However, you may not owe US taxes if your income is below the FEIE threshold and you meet the physical presence test.
Portugal has a progressive income tax system with rates from 14.5% to 48%. The Non-Habitual Resident (NHR) program previously offered reduced rates for qualifying expats, but this is being phased out. You can claim foreign tax credits on your US return to offset taxes paid to Portugal.
The Non-Habitual Resident (NHR) program was a tax regime that offered reduced tax rates for qualifying expats. However, this program is being phased out and may not be available for new applicants. Consult a tax professional for current eligibility.
Generally no. The US-Portugal tax treaty and foreign tax credits help prevent double taxation. You'll typically pay the higher of the two tax rates, not both.
Official resources
Primary sources:
Calculate your take-home pay
See your real take-home pay with currency conversion and cost of living adjustments.
Working in the US? Use our main calculator:
US Take-Home Pay Calculator →