Portugal
Worked in Portugal? Any pension you built up here is yours to keep and can usually be paid to you abroad — but you have to claim it; it won't start automatically. The full state pension age is 66.58, with early access from 60. On totalization, Portugal has bilateral totalization agreements, so the years you worked here may combine with other countries you've worked in. Below is Portugal's system at a glance and what expats should check.
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Overview
Portugal operates a social insurance pension system (Segurança Social) providing earnings-related pensions financed through pay-as-you-go (PAYG) contributions.
The standard retirement age is dynamically linked to life expectancy under Decree-Law 187/2007: it stands at 66 years and 7 months in 2025, rising to 66 years and 9 months in 2026, and 66 years and 11 months in 2027. The pension formula is based on reference earnings (average of the entire contributory career from 2002 onwards) multiplied by an accrual rate of 2%–2.3% per year of contributions, capped at 40 years. A sustainability factor — currently 17.63% for 2026 early retirements — reduces pensions claimed before the standard age, reflecting the ratio of life expectancy at 65 in 2000 versus the year prior to retirement.
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The system includes a tiered annual indexation formula based on CPI (excluding housing) and real GDP growth, with lower pensions receiving higher adjustments. From January 2025, a new rule ensures pensions are updated in the year immediately following their grant. Workers with long careers (40+ years of contributions) benefit from a personalised retirement age that reduces the statutory age by 4 months for each year of contributions above 40, potentially allowing penalty-free retirement before age 65. Those with 48 years of contributions at age 60, or 46 years starting before age 16, may retire without any sustainability factor penalty.
Complementary voluntary occupational pension funds (Pillar 2) have limited coverage in Portugal. Individual retirement savings plans (PPR — Plano Poupança Reforma) form Pillar 3, offering tax deductions of 20% of annual contributions (up to €300–€400 depending on age) and a favourable 8% tax rate on qualifying withdrawals. Portugal has an extensive network of bilateral social security agreements covering EU/EEA countries, the US, Australia, Brazil, Canada, and others.
~74% for average earner (OECD 2025: 70%+ for average and high earners)
Pillar 1: Segurança Social — Regime Geral (mandatory, PAYG DB); Pillar 2: Occupational pension funds (voluntary, limited coverage); Pillar 3: PPR individual savings plans (voluntary, tax-advantaged)
Social insurance / earnings-related / defined-benefit PAYG
Employee
11%
Employer
23.75%
Self-Employed
21.4% (on 70% of declared income; 25.2% for individual entrepreneurs and single-member LLC holders)
Notes
Combined rate of 34.75% of gross earnings; no annual contribution ceiling. Of the total, 20.21% finances old-age pensions. Contracting entities pay 7% (or 10% if economic dependence exceeds 80%) for economically dependent self-employed workers. Contributions apply to all income types including bonuses and 13th/14th month payments.
Common questions
What is the retirement age in Portugal?
The full state pension age in Portugal is 66.58. Early retirement may be possible from 60.
Can I claim a Portugal pension if I live abroad?
Yes. A pension you've earned in Portugal stays yours wherever you retire, and can usually be paid into an overseas account once you reach pension age. It won't start automatically, though — you need to claim it, typically a few months in advance, through Portugal's pension authority.
Do totalization agreements affect my Portugal pension?
Portugal has bilateral social-security (totalization) agreements. These can let you combine the years you worked in Portugal with years in partner countries to meet a minimum qualifying period, so short stints aren't wasted. Which partners and rules apply depends on your own work history.
How is the pension system structured in Portugal?
Social insurance / earnings-related / defined-benefit PAYG Pillar 1: Segurança Social — Regime Geral (mandatory, PAYG DB); Pillar 2: Occupational pension funds (voluntary, limited coverage); Pillar 3: PPR individual savings plans (voluntary, tax-advantaged) It includes 3 schemes in our directory.