The number of Britons officially registered as living in Portugal shot up by more than 30% between 2019 and 2020, well beyond anything that has been seen in recent years. The 34.6% increase was revealed by the latest Immigration, Borders and Asylum Report for 2020 from Portugal’s borders and immigration service, SEF.

Several factors have played into the increase, from Brexit to Portugal’s non-habitual resident tax scheme, which allows many foreigners (including Brits) who move to Portugal to benefit from huge reductions in their income tax bills.

The non-habitual resident tax incentive was introduced in 2009, exempting individuals with certain sources of income from overseas (including pensions) from paying tax on that income. In its 2020 budget, Portugal replaced the exemption with a 10% tax rate – still well below what would be payable in many other countries.

Brexit has played a role in pushing many families towards Portugal as well. From 2011 to 2015, the number of Britons living in Portugal either shrank, or grew by a maximum of 4% per year. Then, in 2016, Britain voted to leave the EU. That year, the number of Brits living in Portugal shot up by 13%. It rose again, by 16%, in 2017 and then by 18% in 2018. Now, the latest SEF report has shown a jump of 34.6% from 2019 to 2020, showing a total of 46,238 Brits officially resident in Portugal in 2020.

This makes Britons now the second largest group of foreigners resident in Portugal, behind Brazilians. Back in 2016, by way of comparison, Britons made up only the sixth largest group of foreign residents in Portugal.