Moving from Germany to Portugal for lower taxes (guide)

In Germany, you are tax resident if you have your gewöhnlicher Aufenthalt (ordinary abode) in Germany—typically more than 183 days in a continuous 12-month period—or if you have a Wohnsitz (domicile) there. A Wohnsitz is a home that you have available with the intention of using it; you do not need 183 days to be resident if you have a permanent home in Germany. To leave German tax residency, you must give up your German Wohnsitz and not spend 183+ days in Germany in a 12-month period. If your family or main economic activity stays in Germany, the tax office may still consider your centre of interests to be in Germany.

In Portugal, you are tax resident if you spend more than 183 days in any 12-month period (consecutive or not) in Portugal, or if you have your habitual home there with the intention of using it as your main residence. Portuguese residents are taxed on worldwide income at progressive rates (up to 48%). Corporate tax is 21% on the mainland (17% on the first €50,000 for small companies). Capital gains are generally included in income. The former NHR (Non-Habitual Resident) regime was closed to new applicants in 2024.

Germany has higher effective tax burdens for many: income tax up to 45% plus solidarity surcharge, and Abgeltungssteuer at around 26–28% on capital gains (with a €1,000/€2,000 allowance). Corporate tax is around 30% (federal plus municipal). Portugal has income tax up to 48% and no separate flat withholding on capital gains for residents (gains are part of taxable income). Corporate tax is 21% (mainland). VAT is 19% in Germany (standard) and 23% in Portugal. Many remote workers and entrepreneurs move from Germany to Portugal for lifestyle and a different tax structure; ensure you properly leave German residency (no Wohnsitz, under 183 days) and establish Portuguese residency if that is your goal.