A guide to starting a business in Portugal

Portugal has many benefits for foreign nationals aiming to start a business, or open a branch of an existing company in Portugal. It is a relatively easy process with the right documentation and assistance.

This guide summarises the most important information in our setting up a business in Portugal hub, and the importance of instructing multilingual and multijurisdictional lawyers (Advogados).

Click on the links below to jump to that section:

• How do I start a business in Portugal?
• How do I authenticate a company in Portugal?
• What are the necessary documents for company formation in Portugal?
• What are the potential adverse issues for non-Portuguese nationals starting a business?
• What are the benefits of starting a business in Portugal?
• What are the main employment laws to know about in Portugal?
• How do you set up your taxes as a Portuguese business?
• What are the different immigration and work permits in Portugal?
• What are the different trade laws and agreements in Portugal?

How do I start a business in Portugal?

Before you consider setting up a Portuguese company, you must understand the requirements expected from you, including a Portuguese work visa and residence permit (Certificado de Registo). You will also require a tax number (numero fiscal de contribuinte) and a social security number from the Portuguese social security office.

Once you have organised the legal requirements for setting up a business, you can then register your business by naming your company, choosing an appropriate legal entity, and opening a Portuguese bank account.

Find out more about how to start a business in Portugal with our expert guide here.

How do I authenticate a company in Portugal?

Public companies (SA) require a minimum share capital of €50,000. The accounting and auditing requirements for these companies are quite strict. Whereas a Portuguese limited company have a reduced share capital requirement of only €1.

Legal structures for businesses in Portugal are regulated by the Portuguese Companies Code. As stated above, your business type depends on whether you are setting up a business as an individual, or whether your company has multiple owners.

Find out more about how to authenticate your company in Portugal with our expert guide here.

What are the necessary documents for company formation in Portugal?

Setting up a business in Portugal is relatively easy, but certain documentation is required, such as evidence of the company name and the business bank account.

Regardless of whether you are an EU or a non-EU citizen, the following documents are required:

• Social security number - Número de Identificação da Segurança Social

• Tax number - Número de Indentificação Fiscal (NIF)

• Portuguese residency card

For the work visa, you must provide documentation of a solid business plan, proof that your idea is economically viable and relevant to Portugal, and that you have experience in your chosen field.

Find out more about the necessary documentation to set up a business in Portugal with our expert guide here.

What are the potential adverse issues for non-Portuguese nationals starting a business?

Although the process of setting up a company in Portugal is fairly straightforward, there can be certain problems that non-EU citizens may face. This includes maintaining an unblemished record, understanding the Portuguese tax system, having insufficient knowledge of Portuguese law, and choosing a legal business structure.

To ensure your business is legal and compliant with Portuguese law, it is important to seek legal advice from an international law firm that can assist in setting up a company in Portugal and guide you through each step.

Find out more about the challenges of starting a business in Portugal with our expert guide here.

Giambrone & Partners are a team of international lawyers with legal capacity in various global jurisdictions. Due to the multiple steps and potential issues, our Portuguese office can help ensure the company incorporation.

Contact Giambrone & Partners today for more information.

What are the benefits of starting a business in Portugal?

Portugal attracts many businesses, including large conglomerates such as Google and Vodafone. There are several benefits for non-nationals when setting up a company in Portugal:

• Tax incentives
• Visa opportunities
• Strong business infrastructure
• Good location
• Easy company formation process

Find out more about the benefits of setting up a company in Portugal with our expert guide here.

What are the main employment laws to know about in Portugal?

If you are considering setting up a business in Portugal, or wish to work there, you should be aware of the Portuguese employment laws in place, including the rules surrounding termination of employment. All foreign and Portuguese employees’ rights can be found in the Portuguese Labour Code, which covers: working hours, health and safety, parental leave, working conditions, and sick leave.

Employers must pay social security in Portugal at a rate equal to 26.5% of the employee’s wage, and they are not permitted to contact their employees outside of working hours.

Annual leave for Portuguese employees amounts to 22 days of leave plus 13 national holidays. If you aim to start a business in Portugal, you are obligated to operate a training scheme for your employees, as they are entitled to 40 annual hours of training per year.

Find out more about the different employment laws in Portugal with our expert guide here.

How do you set up your taxes as a Portuguese business?

When setting up a company in Portugal, keeping a record of your tax obligations and the amount of tax you must pay is important. This amount will vary depending on the legal structure (forma legal), the size of the company, and the value of the annual profit. This includes:

• Corporate income tax (Imposto Sobre o Rendimento das Pessoas Coletivas - IRC) - at a flat rate of 21% of any taxable profits, paid annually.
• Value added tax (Imposto Sobre o Valor Agregado – IVA) - standard rate is currently 23%.
• Derrama municipal – a tax on profits and is set by the Portuguese council; a maximum of 1.5% is paid annually.

Certain tax incentives are also available in Portugal to support businesses and stimulate economic growth. Benefits include a credit against corporate tax liability of 32.5% against expenditure incurred by a Portuguese business that engages in research and development (R&D) activities.

Find out more about the tax system in Portugal with our expert guide here.

What are the different immigration and work permits in Portugal?

Foreign nationals seeking to create a company in Portugal must apply for a visa. Typically, for foreign nationals, this is the D2 visa (or the visa for immigrant entrepreneurs), which must be submitted alongside a detailed business plan and proof that the idea is financially viable and connected to Portugal’s economy.

They must also apply for a Portuguese residency permit from the Portugal Immigration Service (SEF), which costs €90, and a D2 work visa. Once these documents have been acquired, non-Portuguese nationals must present their identity card and a tax code to the Empresa Na Hora to register the company.

Find out more about the different immigration and work permits in Portugal with our expert guide here.

What are the different trade laws and agreements in Portugal?

Portugal is in the European Union which brings the opportunity for businesses to trade in the European Union market which allows the free movement of goods, services, capital, and labour among its member states.

In addition to its EU membership, Portugal has entered into several bilateral trade agreements with countries and regions outside the EU. This includes Brazil, China, the USA, and African Portuguese-speaking countries (PALOPs) like Mozambique.

Find out more about trade laws and agreements in Portugal with our expert guide here.

If you are considering setting up a company in Portugal, it is advisable to seek legal advice as soon as possible. Instructing international and multilingual lawyers (Advogados) will help guide you through the company formation process, ensuring you are fully aware of what is expected during incorporation.

Contact Giambrone & Partners today for more information.