For highly qualified individuals based in London, this shift is driving increased interest in destinations that offer not only career continuity, but also a stronger overall quality of life.

For those under the age of 35, Portugal is increasingly standing out as a compelling option. Alongside its climate, safety, digital infrastructure and international connectivity, recent tax measures have further strengthened the country’s appeal to younger professionals who are able to work remotely or on a flexible basis.

Under Portugal’s 2025 State Budget, the Youth Personal Income Tax regime has been extended and simplified. The regime applies to employment and self-employed income earned while the individual is tax resident in Portugal and is available to taxpayers up to the year in which they turn 36. Importantly, eligibility no longer depends on the completion of a formal cycle of studies, removing a previous administrative barrier and broadening access to the scheme.

The regime operates as a partial exemption from Personal Income Tax for IRS purposes in Portugal, rather than from a full exemption of gross income. It applies to income from employment (Category A) and self-employment or business activities (Category B) during the first ten qualifying years of earning such income while tax resident in Portugal.

The exemption is applied progressively. One hundred percent of qualifying income is exempt in the first year, seventy five percent in the second, third and fourth years, fifty percent in the fifth, sixth and seventh years, and twenty five percent in the eighth, ninth and tenth years. The benefit is subject to an annual cap equal to fifty-five times Portugal’s Social Support Index.

A transitional framework has also been introduced to ensure fairness for younger individuals already in the workforce. Taxpayers are placed into the appropriate exemption year based on their prior income history, excluding years in which they were classified as dependants. If no qualifying income is earned in a given year, the exemption is paused and resumes when income generation restarts, until either ten qualifying years are completed or the age limit of 36 is reached.

Commenting on these changes, Christina Hippisley, General Manager of the Portuguese Chamber of Commerce in the UK, said:

“Remote work has changed how younger professionals, particularly those based in London, think about where they want to live and work. Portugal offers a rare combination of lifestyle, connectivity and tax advantages, and the extension of the Youth Personal Income Tax regime reinforces the country’s commitment to attracting internationally mobile talent.”

For London-based professionals seeking a clearer understanding of what relocating to Portugal could look like in practice, the next Moving to Portugal Show and Seminars will take place in London on 26 March 2026. The free-to-attend event brings together trusted specialists in property, tax, visas and relocation, offering practical insight and direct access to professional advice.

Registration is now open, and early booking is recommended via https://MTP-London-2026.eventbrite.co.uk