Here we will share all you need to know about renting a car in Portugal.
Public transportation in Portugal is cheap but so are rental cars. We’ve had rentals for $5 a day, a steal for the comfort and flexibility you get in return.
A car is not needed in Lisbon and Porto but there are lots of other amazing places to explore in Portugal.
Once you go outside Lisbon and Porto public transportation options are limited. If you want full freedom to explore any area that interests you, then a car rental is really the best option.
The good news is that renting a car is easy, there are loads of car rental companies including international household names. Driving in Portugal is also relaxed and you very rarely see accidents.
There are some things to keep in mind, such as the toll roads, and we’ll cover all of them here.
In a hurry?
If you don’t have time to read the full post, here is a list of the best rental car companies in Portugal:
Rentalcars.com: Here you can quickly and easily compare the prices of different rental companies. Booking via Rentalcars is very easy. It’s a very intuitive website and you can see all important things at a glance, such as the car details, the number of miles included (usually unlimited), the included insurance, and the cancellation conditions.
Discover cars: The booking process with Discover Cars is just as intuitive as it is with Rentalcars. All rates include the CDW and I like that the deductible is already clearly shown on the comparison page. The fuel policy included mileage and the cancelation policy is also clearly stated. Most cars are cancellable up to 2 days in advance without any fees. In some cases, a fully refundable deposit is taken at the time of booking.
Renting a car in Portugal
Here are all the things you need to know about renting a car in Portugal.
With these tips, you will be able to rent a car in Portugal for cheap and avoid any surprises or extras.
Why rent a car in Portugal
Some of Portugal’s most beautiful spots are inland and difficult to reach by public transport.
That being said, we also think that there’s nothing that can beat the freedom of having your own car.
You’re the master of your own schedule and you don’t need to stress about missing the last train or bus back.
Of course, this flexibility comes with a price, but we’ve been to Portugal numerous times and have always found a car for a very affordable (read: cheap) price.
Here is an amazing 2 week Portugal itinerary.
Should you self-drive in Portugal?
We are fully in favor of a self-drive vacation in Portugal. No set times when to get up, no waiting for buses or trains, and no dragging with your luggage.
In addition to that, if you have your own car, you can stop as often or as little as you want.
Believe us if we say that you will come across many scenic roads in Portugal. Getting from one place to the next often involves many photo stops along the way.
Driving in Portugal is also relaxed, once you leave Lisbon you will notice that people often go slower than the speed limit.
While this would certainly annoy me at home, I found it a bliss when cruising through Portugal as it allowed me to enjoy the beautiful views.
Car rental Insurance in Portugal
If you’ve rented cars in other countries you’re probably familiar with how these insurances work.
There is the basic CDW but it usually comes with a high deductible.
In addition to the basic CDW most car rental companies also offer additional insurance packages.
The basic CDW is compulsory in Portugal, it includes unlimited third-party liability insurance and is required by law.
Additional insurances cover the excess, damage to the windscreen, mirrors, wheels, scratches, and more…
These insurances are optional, and because driving is so relaxed in Portugal they’re not really necessary in our opinion. Burglary in cars is also not as big of a problem as in other countries.
Still, they can give peace of mind and there have been cases where we took out full insurance.
The rental companies deal differently with what they consider to be damage.
Whereas most international brands will ignore scratches that are smaller than 2 centimeters the ultra-low-cost local companies will charge you for every tiny scratch they can find.
This is something to take into account when comparing prices.
A good website to compare car rental prices is Discover Cars.
We consistently find the best deals on this website. They also clearly show the deductible and offer full coverage for a competitive price.
If you take out full-coverage with Discover Cars they will refund the excess that you had to pay to the car rental company.
Travel credit cards
Travel credit cards often include a hire car excess policy. Check this before you take out additional insurance because it is not necessary to be insured for the same twice. Make sure to read the fine print of your credit card’s policy, there are always conditions attached to the policies. Usually, these involve that you need to use the card to pay for the car. There may also be a limitation on the duration of rental and sometimes certain countries are excluded.
Can you rent a car at your destination?
Car rental companies have offices in all major cities and airports. This is the case in mainland Portugal as well as in Madeira and the Azores.
However, we do not recommend that you wait until you arrive at your destination.
Not only lots of cars are already booked in advance which means you have fewer choices but it’s also often cheaper to rent a car in advance.
Renting your car online allows you to compare the prices of the different car rental companies and book a car that suits both your budget and your needs.
Renting a car in Lisbon
There are tons of car rental companies in Lisbon.
Thanks to the fierce competition you will usually find very attractive prices.
Discover Cars always gave us the best deals comparing the local companies with the major international brands.
You don’t need a car for a city trip to Lisbon.
If you have a road trip that starts in Lisbon and you’ve planned a few days to visit Lisbon at the start or the end of your trip consider renting a car from one of the downtown offices.
Check prices and availability:
Discover cars Lisbon
Renting a car in Porto
In Porto there are slightly fewer rental companies but still more than enough.
You can use an aggregator site like Discover Cars to compare them all in one go.
You don’t need a car to explore Porto itself.
If your road trip starts in this city consider picking up your car in one of the many downtown locations on the day that you leave the city.
Check prices and availability:
Discover cars Porto
Renting a car in the Algarve
You will find rental offices in all major cities in the Algarve as well as at Faro Airport.
It may be worthwhile to check for prices before you book your flights.
We have noticed that car rental prices in the Algarve tend to significantly surge in the high season.
Cars in Lisbon can be much cheaper and flights to Lisbon are usually cheaper or at most the same price as well.
Lisbon to Faro is 2 hours and 30 minutes by car using toll roads.
The toll is approx. €25 in 2021. If you avoid toll roads it will take you closer to 4 hours.
Should you rent a car from the airport?
You will find that there are offices both in the city center as well as at the airport.
When deciding between the two, you should know the following.
Renting a car at the airport
Rentals at the airport come with an airport surcharge that may make the rental a tad more expensive.
On the other hand, these offices tend to have a wider selection and more competition which will usually make up for the extra fee.
Renting a car in town
The airports are well-connected and you won’t be needing your car while you explore the cities.
Which car to rent in Portugal
Even though we don’t have kids we usually rent mid-size vehicles just to have a larger trunk.
If you’re traveling with 2 suitcases, like we do, a smaller car usually means that one suitcase will need to go on the back seat.
In Portugal, however, small is beautiful.
When in Portugal we opt for an economy car.
These models are still large enough to comfortably fit the two of us.
The drawback is that some of our luggage will need to go in the back seat but this is nothing compared to the benefits this car has in the narrow streets that you will encounter all over Portugal.
Maneuvering these narrow streets with sharp turns and blind corners can be a stressful experience and you will regret hiring a big car the first time you come across one of these.
Tips for avoiding narrow streets
Avoiding such streets completely is not always possible, but there are a number of things you can do to avoid them as much as possible.
- Park your car outside historical city centers and walk the last few kilometers.
- Don’t follow your GPS blindly, they sometimes suggest a shortcut whereas you could also stay on the departemental route. It’s often such shortcuts that tend to be steep and narrow back roads.
- Don’t drive any further if you see the street narrowing. Stop and look for alternatives or get out and inspect the road on foot. This is often easier because having to back up your car in such narrow streets is the last thing you want to do.
Where to rent a car in Portugal
Finding a rental car shouldn’t be too much of a problem.
All major car rental car companies are present in Portugal, they have offices in mainland Portugal as well as on the Azores and Madeira.
In addition to that, you will also find numerous small-scale rental car companies, some of which are only present in Portugal.
Instead of comparing all rental agencies individually we always rely on Discover cars and Rentalcars to compare all car rental companies.
Both do a good job but these days we consistently find lower rates with Discover Cars.
Here’s a comparison of both sites.
This is our favorite aggregator site. They compare over 30 suppliers to find the best deals.
These include the household names like Hertz and Avis but also lesser-known local companies like Record-Go, Guerin, and Goldcar.
The site works well to find good fares in mainland Portugal as well as on the Azores and Madeira.
You can check the rental conditions for a complete and clear listing of all important aspects including the security deposit, the deductible, the cancellation policy, the driver requirements, and any cross-border restrictions.
Most cars are cancellable for a full refund up to 2 days in advance.
The fuel policy and the included mileage is also clearly mentioned.
All rates always include the basic CDW and it’s possible to upgrade to full coverage for a very competitive price.
It’s possible to book extras like child seats and E-toll devices during the booking process.
We recommend booking a toll pass when you’re hiring a car in Portugal. More about this later.
Check prices and availability:
Rentalcars will be a known name for many.
Both sites are very much alike, if you have used one of the two, you will find your way around the other without any problems. To find all important details (the small print) of the rental conditions you need to click on “important information”.
The list of suppliers that Rentalcars checks is a little smaller which could explain why the rates found are usually more expensive.
Rental cars are usually cancellable for free up to 48 hours in advance.
The rental prices shown include the basic CDW and Rentalcars offers 2 insurance packages that can be added to the rental if you want a more carefree journey.
These insurance packages are more expensive than the ones offered by Discover Cars.
The Premium insurance has 1 advantage, namely that you can rent with a debit card. It is very expensive though.
It’s also possible to add all kinds of extras like child seats and toll pass devices to your rental.
Check prices and availability:
Rules for renting a car in Portugal
If you’ve ever rented a car in another country, you’ll find that the rules are very similar around the world.
Here are some important things to keep in mind when renting a car in Portugal.
Most companies have a minimum age for the driver.
The legal minimum age in Portugal is 18 but many companies only accept drivers who are 21 or older.
As long as you are not yet 21 you will have to choose from a limited selection of suppliers including Alamo, Budget, and Enterprise.
There will also be a surcharge called a “Young-drive fee”.
This fee not only applies to those under 21, the age up to which this is applied varies per company.
Some companies like Alamo are rather generous and only charge it when the driver is 21 or younger.
You also have Dollar where a surcharge applies up to the age of 30 for certain models.
Both Discover Cars and Rentalcars will show whether a Young-driver fee” is applicable.
Discover Cars will show the total amount, including the fee, in the search results.
Rentalcars will show the surcharge in small below the price of the car.
In addition to the age, many companies also require that you have had your driver’s license for a year (sometimes 2 years).
These details are found in “important information – required to pick up your car” section of Rentalcars, or the “rental conditions – driver requirements” section when using Discover Cars.
You will usually need to inform your rental company if you plan on driving the car to Spain or any other country.
Most probably a surcharge will apply.
Failing to inform the company will void all your insurances.
Renting a car in Portugal and driving to Spain
Neither Discover Cars nor Rentalcars show the full details about these policies.
If your road trip takes you across the border, it is best to contact the rental company for all the details.
Sometimes you will also find more information on their own website.
Island-hopping in the Azores
Some, but not all, rental agencies on the Azores allow you to take your car on the ferry.
It can reduce the hassle that comes with having to rent a new car all the time. A disadvantage is that the car usually has to be returned where you rented it. One-way rentals with drop-offs on another island are almost never allowed.
All the details are found in “important information” section of Rentalcars, or the “rental conditions” section when using Discover Cars.
We didn’t take our car with us on the ferry but instead made use of “multi-island-hiring” when we were island hopping on the Azores.
What is required to rent a car in Portugal
To be able to rent a car in Portugal you need 3 things.
A driver’s license: This makes sense of course and I’m hoping you weren’t planning on driving a car in Portugal if you’ve never done so in your own country. One important thing to keep in mind is that most rental companies will require you to have your license for at least one year at the time that you pick up your car. (for some companies this is 2 years) Find out here whether you need an international driving permit.
A passport or ID card: When collecting your car you will need to present your passport or ID card together with your driving license.
A credit card: Most companies require that the credit card is in the driver’s name. Visa and Mastercard are widely accepted. Most companies also accept American Express. Debit cards and prepaid cards are in general NOT accepted. There are some exceptions though. This means it is possible to rent a car with a debit card.
Can you rent a car in Portugal with a debit card?
The short answer is yes. If you have a credit card we recommend against using your debit card for your rental but if you only have debit cards these are two things you can do to rent a car in Portugal.
One car rental company that accepts both credit and debit cards is Turisprime.
Avis does also accept debit cards in some instances (check the rental conditions) but requires the driver to be 25 or older.
The options will be limited. The good thing is that Turisprime is not the cheapest but they’re not overly expensive either.
Another option is to look with Rentalcars for cars that have the Premium insurance package available.
This premium insurance package will deal with the security deposit.
Because there’s no longer a security deposit required you will be able to use a debit card to collect your car.
The cost of the premium insurance package is considerable and we recommend renting with Turisprime instead whenever possible.
Do you need an International Driver’s License
Few people will need to apply for an International Driver’s License.
These are the requirements:
- EU Citizens can use their current EU driver’s license without any restrictions.
- This also applies to citizens of Switzerland and other countries in the European Economic Area.
- Non-EU visitors with a driver’s license in English or Portuguese can use their driver’s license for maximum 6 months. If they will stay longer in Portugal they will need to apply for an EU license.
- All others will need to apply for an International Driving Permit (IDP) or an official translation of their current license. In both cases you will always have to carry that document together with your original driving license.
Renting a car in Portugal with a UK license
Can I hire a car in Portugal with a UK license? Yes, you can!
Your UK driver’s license is valid in Portugal for a period of up to 6 months. This is true for both photocard driving licenses as well as paper driving licenses.
Renting a car in Portugal after Brexit
After Brexit, you can still use your UK driver’s license for a period of up to 6 months.
The only thing that has changed because of Brexit is that you will now have to apply for an EU license if you want to stay longer.
Renting a car in Portugal with a US license
Portuguese law accepts American Driver’s licenses for rentals of 6 months or less. There’s no need to apply for an international driving permit.
Renting a car in Portugal with a Canadian license
As a Canadian, there’s no need for an International Driving Permit.
All you need is your Canadian driver’s license as long as your rental is for 6 months or less.
Tips for renting a car in Portugal for cheap
Save on fuel
Unfortunately, fuel is expensive in Portugal, certainly if you compare it with other expenses like those for food and drinks.
This is another reason to take a smaller car. The smaller the car, the less fuel consumption.
To find the cheapest gas stations on your route, or in your neighborhood, you can install the 1-2-3 Fuel app on your phone. The app shows data that is coming directly from the fuel stations and is therefore very accurate.
Most companies will use a Full-to-Full fuel policy, meaning that the gas tank is full when you pick up the car and needs to be full again when you drop it off.
Don’t go for another policy as this will inevitably cost you more. The price charged by the rental companies for refueling the car is more expensive than what you pay yourself at the pump.
Do you need a GPS?
The road network in Portugal can be a real tangle. A navigation system can therefore come in handy for your road trip.
However, rental companies charge exaggerated prices for their GPS systems, which are often not even as good as Waze and Google maps.
Both Waze and Google maps work extremely well in Portugal. They know all the sights and we use a combination of both whenever we are in Portugal.
Google maps has the advantage that you can download the maps to your phone in advance and use it without a data connection.
One-way car rentals and drop-off fees
The rental companies prefer that their cars are returned to the original location because this makes it easier for them to manage their stock.
You’re almost always allowed to return it to another location but this will result in a surcharge. The surcharge is variable and largely depends on the distance between your pick-up and return location.
This fee is automatically included and clearly shown when using Rentalcars and Discover Cars.
Sometimes this can be interesting, but we usually don’t recommend it because the fees charged are often excessive.
Check your pick-up and drop-off hours
Your rental price is calculated based on the hours you indicated when you did your search. Choose these hours carefully, because an hour difference can mean that you pay a whole day extra.
Here’s an example to make this clear:
If you indicate that you’re going to pick up the car today at 2 PM and return it tomorrow by 2 PM you will pay for one day. If you instead opt to return it tomorrow at 3 PM you will pay 2 full days.
If your travel plans allow for it, returning the car an hour earlier can save you quite a few bucks.
Daily rates vs weekly rates
Some companies use a combination of daily and weekly rates and there have been cases where the weekly rate was significantly cheaper than the daily rate. In those cases renting a car for 7 days turned out to be cheaper than renting one for 6 days.
This is more of an exception than a rule but it never hurts to check.
Before booking this, you should check how the rental company handles the earlier return of cars.
There’s usually no problem returning a prepaid car earlier as planned but some companies may charge administrative fees for doing so. Others will recalculate the price to refund any unused days, which can be detrimental in this case.
However, it is highly unlikely that companies will do this with prepaid rates.
Possible extra charges when you rent a car in Portugal
We already covered several possible extra charges above:
In addition to the above, here are a few more things for which you can (have to) pay extra.
Only one person is authorized to drive the car.
An additional driver fee must be paid for each extra driver.
Usually, you can arrange this directly at the time of booking the car. The additional driver is one of the optional extras listed on Discover Cars and Rentalcars.
There may however be instances where it needs to be arranged at the counter.
Depending on the supplier the fees for child seats can vary from €7 to €15. For longer road trips it can be interesting to bring your own seat.
The extra bag fee of the airline might be cheaper than what the car rental company charges.
This is one option that we recommend taking.
There are many toll roads in Portugal and the toll roads are sometimes significantly faster than the departmental roads.
New toll roads no longer have toll booths, only electronic gates, and thus can no longer be paid for with cash or credit/debit cards.
The A22, the principal motorway in the Algarve, has these electronic tolls.
You can set up your GPS to avoid toll roads, we also do this if time allows, but this is not foolproof. In our experience, Google Maps and Waze are usually very accurate but here we had 2 times that we still drove through a toll gate.
Without a toll device, you will then have to pay your toll at the post office (see below). To avoid such administration, we always opt for a toll device.
Most rental companies offer a service where you do not have to return the car with a full tank. Supposedly to take the worry out of finding a gas station.
This is almost always a bad deal and finding gas stations in Portugal is not all that hard.
There are gas stations near the airports and if you use Waze or Google Maps it will be easy to find a petrol station close to the station where you need to drop off the car.
Both Discover Cars and Rentalcars offer free cancellation up to 48 hours before your pick-up.
Renting a car in Portugal: Manual vs Automatic
Manual transmission still rules in Europe and is only gradually disappearing in favor of automatic transmission.
The range of automatic cars is small compared to those with manual transmission and they will usually be at least double the price.
If you book only short in advance, the price difference will be even greater.
If you want a car with an automatic transmission, it is best that you book it as long as possible in advance.
Driving in Portugal
Highways and toll-fees
Portugal has many toll roads and a large part of them work with a system of electronic gates. You no longer find a traditional booth where you can pay with cash or credit card.
You also recognize these highways by this sign.
When renting your car, you can choose to pay extra for an e-toll device. The fee is usually anywhere between 1€ and 2€/day. If you have this device you can use these toll roads.
After your rental, you will receive an overview of the toll from the rental company and they will settle this on your credit card.
This E-toll device, called Via Verde, also allows you to use the automatic gates at the traditional toll roads.
Another option is to sign up for EasyToll.
This is something you can do yourself online.
You need the car plate and a Visa, Mastercard, or Maestro card. The car plate will be linked to your credit or debit card and the fees will be directly charged to your card each time you pass a toll gate.
Easytoll registrations are valid for 30 days. They are valid only on highways with the electronic toll system. You will need to use the traditional booths at the other toll roads.
Paying your toll at the postal office
Electronic toll fees can also be paid at the postal offices but this is a cumbersome process.
First of all, it takes at least one day but sometimes 2 days before the postal office can see what tolls are associated with your license plate.
You also only have 5 days to pay your tolls.
If you often use these toll roads, you will therefore often have to go to the post office.
A disadvantage of this way of working is that you will no longer be able to drive on the toll roads for the last 2 days of your vacation because you will not be able to pay this toll.
The car rental company will get a fine for these unpaid tolls and charge this, along with an administrative fee of their own, to your credit card.
Most road signs are self-explanatory.
Speed limits are indicated by circular signs with red borders. The most common speed limits are 50km/h in residential areas, 90 km/h on departmental roads, and 120 km/h on motorways.
Almost all residential areas have a “velocidade controlada” traffic light. A sign announces the traffic light but already at the sign your speed is measured by a radar. Slow down to 50km/h before the sign or you will arrive at a red light.
Points of interest are indicated by brown signs. Most sights are well marked, but it can’t hurt to use your GPS.
Toll roads where there is a choice of both automatic or manual payment will have green “V” signs above the automatic lanes. You can only use these lanes with the Via Verde E-toll device.
Cell phones can only be used hands-free when driving. If you want to make a call you must pull over.
The driver is not allowed to use headphones.
All passengers in the car need to wear their seatbelts.
Portugal’s alcohol limit is 50mg/100ml blood
Road conditions are in general really good. Toll roads are often almost deserted and in excellent condition. Departemental roads are also really good. They can be busy close to larger cities but not to that extent that the traffic is overwhelming or chaotic.
If possible I would try to avoid the historic city centers. The streets are really narrow and double parking is really common. There you will sometimes have to use your maneuvering skills.
Large parts of the road network in Portugal are not (or badly) lit at night.
Finding parking in the historic city centers can be an issue. Due to the narrow streets and small parking spaces, a small car is also recommended. It is always best to park your car outside the center.
Lisbon and Porto have underground parking but these are expensive to Portuguese standards.
We have already done many road trips through Portugal and we hope that with this post you have all the information you need to go out on your own.
Traveling through Portugal’s interior is a really fun experience and you will discover many incredible places.
Have a great trip!