1. An attractive destination for retirees

Cape Verde has steadily established itself as a safe and welcoming destination for retirees from all over the world, with a mild climate, peaceful communities and a rising quality of life. Set in the middle of the Atlantic, its recognised political and institutional stability and its proximity to Portugal and Europe, the West African coast and the USA make the archipelago especially appealing for a calm and pleasant retirement.

2. Residence permit and tax benefits for foreign pensioners

Residence permit

Foreign nationals with pensions above 130,000 escudos, in foreign currency and generated outside Cape Verde — individually or as a couple — may be authorised to reside permanently in the country.

Exemption from tax on pensions paid from abroad

Retirement income generated outside Cape Verde is exempt from IRPS (personal income tax), provided it has no local source — representing significant tax savings.

Foreign pensioners also enjoy the following rights and exemptions:

  • The right to import a light vehicle for personal use, exempt from customs charges, duties and fees;
  • The right to import personal effects or household furniture, with the same exemptions;
  • Exemption from property transfer tax on the purchase of a primary residence.

They may also benefit from the External Investor Status should they make relevant investments, under the specific legislation.

Green Card and second residence

A foreign national who acquires a second residence above certain thresholds (for example, real estate investments over €120,000) may obtain permanent resident status through the Green Card. This status grants exemption from the single property tax (IUP) on transfer and a 50% reduction over the following ten years, in addition to tax exemption on pensions not generated in the country.

3. Investment incentives and the regime for emigrants

Cape Verdean legislation — through Law no. 73/IX/2020 — provides specific tax incentives for emigrant retirees who invest in the country:

  • Exemption from IRPC (corporate income tax) on dividends and profits distributed from investments made in Cape Verde;
  • Exemption from customs duties on the import of construction materials or furniture for a primary residence;
  • Flexibility to invest in companies, shareholdings or local projects.

4. Double-taxation treaties and fiscal transparency

Cape Verde maintains double-taxation avoidance treaties with countries such as Portugal, Spain, Guinea-Bissau and Mauritius, among others. Thanks to these treaties, many pensioners avoid being taxed on the same income both at home and in Cape Verde. Local law is also aligned with international standards of fiscal transparency, including the automatic exchange of information.

5. Quality of life and social stability

Cape Verde shows solid human-development indicators, with high life expectancy and public and private health systems in consolidation. The cost of living is relatively affordable, especially outside the main urban centres, and the country stands out for its safety and stability.

Conclusion

For foreign retirees seeking to maximise their pension income, live in a mild climate with moderate costs and benefit from a favourable tax environment, Cape Verde is an excellent choice. The combination of pension tax exemption, the regime for emigrant investors and the Green Card status creates a highly competitive environment compared with other destinations.

Note: the figures and regimes indicated may be updated. We recommend confirming case by case with our team.