Move to the US from Portugal with Expert Expat Financial Advice
Plan your relocation with clarity, confidence, and cross-border financial expertise from Blacktower Financial Management.
Relocating from Portugal to the United States is a major life change — whether for work, education, family, or a new chapter in retirement. The move brings exciting opportunities, but it also introduces a complex set of financial challenges. The US tax system, investment regulations, and reporting obligations are vastly different from those in Portugal and the EU.
To move successfully — and protect your wealth — you’ll need a clear understanding of how your pensions, investments, tax obligations, and estate plans will be affected by your relocation. With the right guidance, you can make the transition seamlessly and ensure your money works for you both during and after the move.
Here’s how to prepare financially when moving from Portugal to the US, and why professional expat financial advice is essential.
1. Why People Move from Portugal to the US
Over recent years, more individuals and families have chosen to move from Portugal to the US, attracted by:
- Career and business opportunities in the world’s largest economy.
- Educational prospects and globally renowned universities.
- Family reunification or lifestyle preferences.
- The appeal of the US investor or entrepreneur visa routes.
Whatever your reason for moving, ensuring your financial and tax affairs are structured properly will help you avoid unnecessary costs and maintain your wealth long term.
2. Understanding the Key Financial Differences
The financial landscape in the US is significantly different from Portugal — and from Europe in general.
- The US tax system is citizenship- and residence-based, meaning that once you become a US resident (or citizen), you’re taxed on your worldwide income.
- The US does not recognise many European investment structures, such as Portuguese-compliant life assurance policies or UCITS funds.
- Some investment vehicles commonly used in Portugal can trigger punitive taxation under US rules (especially those classified as PFICs — Passive Foreign Investment Companies).
A professional adviser experienced in US-connected clients can help you restructure your wealth before relocating to avoid complications once you arrive.
3. Reviewing Your Tax Residency and Exit Planning
Before leaving Portugal, it’s vital to confirm when your Portuguese tax residency ends and your US tax residency begins.
- Portugal taxes residents on worldwide income, but only until your official departure.
- You may need to file a final Portuguese tax return (IRS declaration) for the year you leave.
- The US taxes residents and citizens on global income, and reporting obligations begin the moment you establish residence (often determined by the “Substantial Presence Test”).
Proper exit planning ensures you avoid double taxation and remain compliant in both jurisdictions during the transition period.
4. Managing Investments and Wealth Structures
Before you move, it’s crucial to review your investment portfolio and any Portuguese or EU-based structures.
- Portugal-compliant life assurance policies (e.g. Private Wealth Portfolio) and EU mutual funds are typically not US-compliant, as they may fall under PFIC rules — leading to highly unfavourable tax treatment.
- Transferring or restructuring these holdings before establishing US residency can help you maintain tax efficiency and avoid unnecessary penalties.
- Once in the US, you’ll likely need to invest through US-compliant investment vehicles — such as mutual funds, ETFs, or discretionary portfolios approved under SEC regulations.
Your adviser can coordinate this process to ensure a smooth and compliant transition from EU-based assets to US-friendly structures.
5. Pensions and Retirement Planning
Many British or European expatriates living in Portugal hold UK or EU-based pensions — including QROPS, SIPPs, or employer schemes.
When moving to the US:
- These pensions remain UK- or EU-regulated, but withdrawals may be taxable in the US once you become resident there.
- Certain pension transfers or withdrawals may also trigger foreign income reporting requirements.
- The US–Portugal Tax Treaty helps prevent double taxation, but you’ll need advice to structure withdrawals correctly.
A qualified cross-border financial adviser can help you determine the most tax-efficient way to draw or restructure your pension once you settle in the US.
6. Estate Planning and Inheritance Rules
Estate and inheritance planning differs sharply between the EU and US.
- The US imposes estate and gift taxes at federal (and sometimes state) level.
- Portugal, by contrast, has no inheritance tax, only Stamp Duty on certain transfers.
- Your existing Will or estate plan under Portuguese or UK law may not automatically apply in the US.
Ahead of your move, you should:
- Review or rewrite your Will to align with US legal and tax requirements.
- Ensure any life insurance policies or trusts are recognised and compliant under US law.
- Consider dual-jurisdiction advice to manage assets held across continents.
7. Currency and Banking
As you transition from the euro to the dollar, currency management becomes a vital part of your financial planning.
- You may still hold savings, investments, or property in Portugal denominated in euros.
- Exchange rate fluctuations between the euro and US dollar can impact your wealth and income.
- Using FX specialists or multi-currency accounts allows you to manage transfers efficiently and reduce costs.
A financial adviser can help you hedge currency exposure, optimise the timing of transfers, and ensure liquidity in both currencies during your relocation.
8. Property and Capital Gains
If you own Portuguese property, decide whether to retain or sell before relocating.
- Selling while still a Portuguese tax resident may attract Portuguese capital gains tax (CGT), although partial exemptions apply for primary residences.
- After moving, selling could trigger US CGT on the same property, unless properly structured.
- Rental income from retained properties in Portugal will need to be reported to the IRS, even if tax is already paid in Portugal (the US–Portugal treaty allows a credit for this).
Your financial adviser can coordinate tax advice between jurisdictions to help you avoid unnecessary liabilities.
9. Health Insurance and Protection
The US does not have universal healthcare like Portugal’s SNS (Serviço Nacional de Saúde). Residents typically require private health insurance, which can be costly without proper planning.
Before you move:
- Research employer coverage, private medical options, or international expat policies.
- Review your life, income protection, and critical illness cover to ensure continuity during and after relocation.
Blacktower’s network of international insurance partners can help you find a cost-effective, comprehensive solution.
10. How Blacktower Can Help
At Blacktower Financial Management, we have decades of experience guiding expatriates through cross-border moves between Europe and the US.
Our advisers specialise in helping clients from Portugal, the UK, and across Europe transition smoothly to the American financial system.
Book a free consultation today
Take control of your financial journey now! Contact us today to schedule a free consultation with one of our expert advisors. We’ll help you navigate the intricacies of US finance laws and tailor a plan that suits your unique needs. Your path to financial success starts with Blacktower FM.