Spain, Italy and Portugal - Which Country to Choose for the Digital Nomad?

Digital Nomads are specialists (most often from the IT sector) who can fully perform their tasks from any location worldwide. All they need for their work is a functioning device and a stable internet connection. Since 2020, the remote work format has been gaining momentum, as the COVID-19 pandemic forced many to rethink the traditional "office" schedule. Today, getting a job at a foreign company and working remotely has become a common solution.

In recent years, the proportion of remote employees in companies has significantly increased. According to a study by Global Workplace Analytics, since 2005, the percentage of employees working fully or partially from home has grown by 159%. Freelancers are not tied to a single location, allowing them to move from country to country without taking local jobs while contributing to the economy of the country where they reside. Unsurprisingly, these workers have led to the creation of a new type of work permit – the Digital Nomad Visa.

Why is a special type of visa necessary?

The reason is that regular tourist visas, which typically allow stays of up to 90 days within 180 days, are not suitable for these employees. Work visas also don’t apply, as digital nomads are not employed by companies in the host country.

Today, over 50 countries offer a dedicated visa for digital nomads – the Digital Nomad Visa – along with various privileges, such as a favorable tax regime.

In this review, we will discuss why countries are interested in digital nomads, the requirements for obtaining a visa, and which country might be best for nomads to settle in.

Why do countries attract digital nomads?

Countries are highly interested in allowing individuals who earn a stable income outside their borders to live legally for extended periods and contribute to economic growth.

The Digital Nomad Visa can be a stepping stone toward obtaining permanent residency or even citizenship in the host country. This cooperation is mutually beneficial: nomads gain resident privileges, opportunities for tax optimization, and a simplified path to residency.

Benefits for the host country:

• Technological development: Digital workers bring new expertise, experience, and achievements. Sharing knowledge, even among professionals from the same field but from different countries, allows for fresh perspectives and significant improvements in existing practices.
• Attracting skilled workers: Often, remote employees who initially arrive as digital nomads later establish businesses and open companies in the host country. This not only leads to the introduction of digital technologies but also creates new jobs for local citizens.
• Boosting the local economy: Freelancers who stay in a new country for at least a year spend money locally – renting or buying property, purchasing goods, and using local services. By registering as tax residents, nomads also contribute to the country’s budget.
• Managing labor migration: By issuing specific permits, authorities can select the most promising residents and prevent visitors from abusing their tourist status.

Digital Nomad Visa – Main Requirements for Applicants

Countries impose quite strict requirements on future residents. For other visa types, there is usually a basis – such as a work contract, university enrollment, or marriage to a foreigner. For the Digital Nomad Visa, the applicant’s professional activity serves as the foundation.

Key requirements for obtaining a Digital Nomad Visa:

1. Engage in eligible activities: Applicants must prove they are employed as freelancers. This can be demonstrated through a contract with a foreign employer, showing that the applicant works remotely using information and communication technologies.
2. Have a stable income: Many countries set a minimum income threshold. Applicants must provide proof of consistent financial inflows through bank statements or a work contract that specifies their salary. The income must come from outside the chosen country.
3. No legal issues: The applicant must have a clean legal record in both their home country and any country where they have lived for over a year.
4. Provide proof of residence: Along with the visa application, expats must submit documents confirming a long-term lease or property purchase in the selected country.
5. Valid health insurance: Coverage must be at least €30,000 for EU countries. For the USA or Canada, the coverage threshold is even higher.

Advantages of the Digital Nomad Visa

Like any program, the Digital Nomad Visa has its benefits:

• Legal residency in the country for at least one year.
• The same rights as residents, such as enrolling children in school or daycare, accessing healthcare, and opening a bank account.
• The ability to include a spouse and minor children in the application.
• Quick visa processing and, in some cases, no need for further residence permits.
• Many countries offer multiple extensions of the permit.

Choosing a Country for the Digital Nomad Visa

Although more than 50 countries offer digital nomad visas, and new ones join yearly, some countries are particularly popular among nomads – Portugal, Spain, and Italy.

Key factors to consider when choosing a country:

• Minimum income threshold for freelancers.
• Cost of living in the country relative to income.
• Duration of the permit and options for renewal.
• Internet speed, quality of connection, availability of coworking spaces, and Wi-Fi hotspots.
• Climate and lifestyle in the country.
• Language proficiency.

Spain

To obtain a digital nomad visa, you must demonstrate an income of at least €2,650.

Spain is one of the most popular destinations for digital nomads. The ability to optimize taxation, the relatively low cost of living, and the accessible entry requirements for the program have helped Spain secure a leading position in the Digital Nomad Index. By obtaining a digital nomad visa, freelancers also gain the ability to travel visa-free within the EU and Schengen countries. When applying, candidates can indicate that at least 80% of their income comes from abroad, with up to 20% allowed to be earned in Spain.

Applicants for the remote worker visa must work without being tied to a traditional office schedule. The candidate must be employed by a company located outside Spain or be self-employed. It’s essential to provide proof of the right to work remotely and demonstrate financial stability. The candidate's income must meet the SMI (minimum wage) threshold. In 2024, Spain's minimum wage is €1,134. For remote workers, the requirement is 200% of SMI, which equals €2,650 per month. If applying with a spouse, an additional 75% of SMI must be added to the income, and for children, 25% of SMI for each child.

Visa applications are processed within 30 days, with an application fee of €80. The visa is granted for one year, after which you can apply for a three-year residence permit, renewable for another two years. To maintain your status, you cannot leave the country for more than six months.

To become a tax resident, you must stay in the country for at least 183 days per year. Income tax is calculated on a progressive scale:

• Up to €12,450 – 19%
• €12,450 - €20,200 – 24%
• €20,200 - €35,200 – 37%
• €35,200 - €60,000 – 45%
• Over €60,000 – 47%

For the first six years, new tax residents are taxed at a preferential rate of 24%. To apply for the reduced rate, you must contact the tax office within six months of obtaining your residence permit.

Italy

To apply for a digital nomad visa, you must demonstrate an income of at least €2,700.

Italy was one of the last European countries to launch the Digital Nomad Visa program, which began in March 2024. According to the rules, Italy issues a limited number of work permits annually for foreign nationals. In 2024, 151,000 spots were allocated across different sectors, typically filled within the first two months of the year. To qualify for this type of permit, applicants must obtain an Italian Nulla Osta – a special certificate allowing them to work in Italy.

An advantage for applicants under the Digital Nomad Visa program is that they are not required to apply for a separate digital nomad visa.

Italy is also a popular destination due to its high quality of life, mild Mediterranean climate, friendly locals, and relatively low cost of living. Applicants from non-EU countries can apply for the digital nomad visa, with a minimum income threshold of €2,700. Additionally, expats must demonstrate at least €30,000 in savings. A spouse and minor children can be included in the application, with an extra €5,000 required for a spouse and €3,000 for each child.

The digital nomad visa is valid for one year, during which the applicant must apply for a residence permit. The initial residence permit is valid for one year and can be renewed every two years.

How to become a tax resident of Italy:

• Stay in the country for at least 183 days per year and register with the municipal registry.
• List your address in Italy as your primary residence, even if you spend fewer than 183 days per year there.

To become a taxpayer, you must obtain an Italian tax number (Codice Fiscale). Income tax is calculated on a progressive scale. Freelancers earning up to €28,000 are taxed at 23%, from €28,000 to €50,000 at 35%, and income above €50,000 is taxed at 43%.

Digital nomads can also save money through various deductions and tax benefits, including for a spouse, children over 21, healthcare expenses, and mortgage interest payments.

Portugal

To apply for a digital nomad visa, you must demonstrate an income of at least €3,280.

Despite having a relatively high income requirement compared to the previous two countries, Portugal remains a popular destination for digital nomads due to its high quality of life, affordable cost of goods and services, and mild, warm climate.

Today, Portugal offers two types of visas (D8) for freelancers:

• Short-term visas – This type allows you to legally stay in the country for up to one year. However, it cannot be extended or used as a basis for obtaining a residence permit.
• Long-term visas – These are issued for two years and can be renewed indefinitely. In this case, you must apply for a residence permit within the first four months after the visa is approved. After five years of living in Portugal, a nomad can apply for citizenship.

Regardless of which visa type you choose, the minimum income requirement is €3,280, and 100% of the income must be earned outside of Portugal. Additionally, you must show at least €9,840 in savings (equivalent to 12 minimum salaries in Portugal) to prove financial independence. If the applicant includes a spouse, the income requirement increases by 50%, and for each child, by 25%.

To reduce tax pressure, it’s essential to become a tax resident. This requires spending at least 183 days per year in Portugal and either purchasing or renting a property long-term.

If an expat hasn’t been a Portuguese taxpayer in the last five years, they can benefit from a tax regime that applies only to worldwide income.

Choosing a Digital Nomad Visa Program

How do you choose the right program? You need to consider the entry and residency requirements. Some countries have lower income requirements but demand significant savings. It all depends on your individual goals and needs. There is no universal solution that fits everyone.

How should you make your decision? It’s best to consult immigration law experts who stay up to date with new developments and changes in each program. Our specialists can help you choose the most suitable program for your needs, assist with collecting and submitting documents, and provide guidance on applying for residence permits. Working with professionals will help you achieve your goal quickly—whether it’s obtaining a new status or migrating and settling in a new country.