If you own a home in the Algarve, hold savings in a Portuguese bank, or have made Portugal your base, it is worth understanding how your estate would pass on. Portuguese succession law can differ sharply from what you may be used to, and a little planning can give you more say over the outcome.
Forced heirship: why you cannot freely choose
One of the biggest surprises for foreigners is that Portuguese law does not give you complete freedom to decide who inherits. The system protects close family members through a concept often described as forced heirship (the rules on the legítima, or reserved portion).
Under these rules, a fixed share of the estate is generally reserved for certain protected heirs — typically the spouse, children, and in some situations parents. You can usually dispose freely only of the remaining part, often called the quota disponível (the disposable portion).
The exact fractions depend on who survives you, and they can vary by family situation and change over time. As a very rough idea, where there is a spouse and children, a large part of the estate may be reserved, leaving a smaller free portion. Treat any figure you read as approximate only and confirm the current rules with a lawyer.
The practical point is simple: under Portuguese law you generally cannot disinherit your children or spouse and leave everything to someone else. This tends to differ from common-law countries such as England, Ireland, or the United States, where testators often have wider freedom.
The EU succession rule and choosing your law
Here is encouraging news for many foreigners. An EU measure sometimes called Brussels IV (the EU Succession Regulation, often referenced as Regulation 650/2012) helps decide which country's law applies to a cross-border estate.
By default, the law that applies is broadly the law of the country where you were habitually resident at the time of death. So if you live in Portugal, Portuguese succession law — including forced heirship — would often govern your worldwide estate.
However, the regulation also allows a choice of law. You may be able to elect, usually in your will, for the law of your country of nationality to apply instead. For someone from a common-law country, this may mean an estate is distributed more along the lines of home-country testamentary freedom rather than the Portuguese reserved portion.
A few cautions are worth keeping in mind:
- The choice usually needs to be made expressly and clearly, ideally in a properly drafted will.
- It affects how an estate is divided, but it does not by itself change your tax position in Portugal.
- If you hold more than one nationality, or your circumstances are unusual, the analysis can become complicated.
Because this single decision can reshape who inherits, it is one of the more important things to get right — and the way it works can change, so check the current position with a lawyer.
Stamp duty versus inheritance tax
Many newcomers are relieved to learn that Portugal is generally described as having no classic inheritance tax of the kind seen in some other countries. There is typically no broad death tax charged at high rates on heirs, though tax rules can and do change.
Instead, transfers on death may attract stamp duty (Imposto do Selo). The usual features tend to be these:
- Close family — such as spouses, descendants like children and grandchildren, and ascendants like parents — are commonly treated as exempt from stamp duty on inheritances.
- Other beneficiaries, such as friends, some unmarried partners, or more distant relatives, may face stamp duty on Portuguese assets.
- Any applicable rate has historically been modest compared with inheritance taxes elsewhere, but rates and exemptions change — confirm current figures with a lawyer or tax adviser.
Watch your home country too
Even where Portugal charges little or nothing, your country of nationality or former residence may still tax the same estate. The United Kingdom's inheritance tax, for example, can follow a person based on domicile rather than residence. Cross-border estates often need advice in two countries at once.
Making a valid will
A clear, valid will is the foundation of good planning. If you die without one (intestate), the applicable rules decide who inherits, which may not match your wishes.
Foreigners with assets in Portugal often consider:
- A Portuguese will covering Portuguese assets, frequently drawn up before a notary, which can make local administration smoother.
- Keeping a separate home-country will for assets elsewhere, carefully worded so the two do not accidentally revoke each other.
- Including a clear choice-of-law clause if you want your national law to apply under the EU regulation.
Wording matters a great deal here. A will that is valid in one country can create gaps or conflicts in another, so coordinated drafting is usually wiser than copying a template.
Talking to a local lawyer
Inheritance planning in Portugal sits where family law, the EU succession rules, and tax in more than one country meet — and the details shift over time. This guide is general information only, not advice on your particular situation. Before you make a will or rely on a choice of law, it is well worth speaking to a qualified Portuguese lawyer, ideally one used to working with foreigners, who can confirm the current rules and help tailor a plan to your family and assets.