Portugal
Key entity, tax, banking, visa, and compliance guidance for foreign founders incorporating in Portugal.
Foreign Ownership Eligibility
Portugal welcomes 100% foreign-owned companies
Fully remote formation — you never need to set foot in the country.
- No citizenship or residency requirement for any entity type (LDA, SA, Unipessoal)
- Foreign nationals can form a company fully remotely via Empresa Online portal
- No requirement to have a Portuguese address; can use virtual office (EUR 0–300/month)
- Founder does not need to be physically present in Portugal to incorporate
- All company filings and communications can be handled electronically
Ownership
100% Foreign OK
Formation
100% Remote
Note
Foreign nationals planning to reside in Portugal for extended period need appropriate residence visa (D7, Entrepreneur, or other category). EU/EEA citizens have automatic freedom of movement.
Tax at a glance
Portugal Tax Overview
19% + 1.5% surtax = 20.5% (base rate); additional 7–9% local surtax (Derrama) possible
Corporate income tax (IRC) standard
Fact sheet section 3
10% for first 3 years under startup conditions; loss carryforward 12 years
Startup tax regime (IRC)
Fact sheet section 3
23%
VAT standard rate
Fact sheet section 3
13% (food), 6% (books/medicine/rentals)
VAT reduced rates
Fact sheet section 3
48% on income > EUR 80,000
Personal income tax (top bracket)
Fact sheet section 3
28% (reduced to 10% under NHR if active)
Dividend withholding tax
Fact sheet section 3
28% standard; 20% if held > 1 year and reinvested
Capital gains tax
Fact sheet section 3
~23.75% of payroll
Employer social contributions
Fact sheet section 3
20% flat rate on Portuguese-source income for 10 years; NHR discontinued Jan 2024 — replaced by IFICI (Incentivo Fiscal à Investigação Científica e Inovação); qualifying high-value activities, tech, and research
IFICI Tax Regime (replaces NHR)
Portugal State Budget Law 2024; AT portaldasfinancas.gov.pt
Pros & cons
Advantages & Considerations
Key Advantages
Lowest Startup Costs in Western Europe — EUR 1 minimum capital for LDA; online 3–5 day formation; total setup cost EUR 500–1,200; most affordable company incorporation in EU
Startup-Friendly Tax Incentives — 10% corporate tax option under startup regime for 3 years; loss carryforward for 12 years; R&D tax credits up to 37.5%; loss carryforward encourages reinvestment
EU Single Market Access — Direct entry to single market; simplified cross-border operations; SEPA payments; no barriers to EU expansion
Thriving Tech Ecosystem — Lisbon Europe's fastest-growing tech hub (2025–2026); growing startup support infrastructure, accelerators, VC networks; Web Summit hosts
Low Cost of Living — Lisbon office rent EUR 600–1,200/month; salaries EUR 1,200–2,500/month (vs. Northern Europe EUR 3,000+); operational overhead significantly lower
Residence Visa Options — D7 Visa (EUR 17,280/year passive income) allows residence without active business; Entrepreneur Visa (company + plan); Golden Visa (real estate path to PR)
Flexible Employment — Can hire freelancers/contractors easily; gig economy support; flexible labor agreements available
D7 Visa for Passive Income — EUR 17,280/year requirement allows tax-efficient residence without startup operations; renewable indefinitely
Considerations
NHR Regime Discontinued — Original NHR ended for new applicants in January 2024; replaced by IFICI (20% flat rate for qualifying high-value professionals). New founders cannot access the old NHR; IFICI has narrower qualifying criteria. Verify eligibility with a Portuguese tax advisor before planning on this benefit
Complex Bureaucratic Procedures — Multiple registrations required (tax office, social security, labor registration); procedures can be inconsistent across regions; language barrier exists
Language Barrier — Portuguese language essential for official documents; English less common in public administration; slower communication with government
High VAT & Social Contributions — 23% standard VAT (high for EU); employer social contributions ~23.75%; high compliance burden with monthly/quarterly filings
Labor Law Restrictions — Strong employment protections make hiring/firing complex; minimum 12-month trial period; severance costs if dismissal needed
Real Estate Inflation Pressure — Golden Visa program (EUR 280K–500K property investment requirement) creates Lisbon property inflation; commercial real estate expensive in tech districts
Limited Institutional Investor Base — Smaller VC ecosystem than Germany/UK; fewer institutional investors; harder to raise Series A+ funding locally (need EU-wide strategy)
Incorporation Process
The process is strictly digital. Each stage builds on the previous one.
Prepare incorporation documents
Check company name availability
File via Empresa Online
Receive registration confirmation
Tax authority registration
What you'll pay
Cost Architecture
Government Fees
Annual Ongoing
Professional Services
Portugal has lowest minimum capital in Western Europe (EUR 1 for LDA). Total setup cost EUR 500–1,200 is most affordable in region. However, NHR tax regime status for 2026 requires verification before planning tax optimization.
Still unsure about costs?
These are estimates — your actual cost depends on your structure
Every Portugal setup is different. A 15-minute call with one of our specialists will give you a personalised cost breakdown — completely free.
Fintech & Banking
Can non-residents open accounts without visiting? NO.
Banking options for non-resident founders in Portugal. Remote account opening availability varies by institution.
| Institution | Type | Ease for Non-Residents | Notes |
|---|---|---|---|
| CGD (Caixa Geral de Depósitos) | Traditional bank | Low (Visit Required) | 2–5 business days (fintech banks: 1–2 days) • EUR 0–50/month (varies by bank; fintech often EUR 10–20) • EUR 0–500 (many banks have no minimum for business accounts) • Passport, business registration (RNPC), proof of address, proof of capital • SEPA transfers, cards, checks, SWIFT |
| BPI | Traditional bank | Low (Visit Required) | 2–5 business days (fintech banks: 1–2 days) • EUR 0–50/month (varies by bank; fintech often EUR 10–20) • EUR 0–500 (many banks have no minimum for business accounts) • Passport, business registration (RNPC), proof of address, proof of capital • SEPA transfers, cards, checks, SWIFT |
| Millennium bcp | Traditional bank | Low (Visit Required) | 2–5 business days (fintech banks: 1–2 days) • EUR 0–50/month (varies by bank; fintech often EUR 10–20) • EUR 0–500 (many banks have no minimum for business accounts) • Passport, business registration (RNPC), proof of address, proof of capital • SEPA transfers, cards, checks, SWIFT |
| Santander Portugal | Traditional bank | Low (Visit Required) | 2–5 business days (fintech banks: 1–2 days) • EUR 0–50/month (varies by bank; fintech often EUR 10–20) • EUR 0–500 (many banks have no minimum for business accounts) • Passport, business registration (RNPC), proof of address, proof of capital • SEPA transfers, cards, checks, SWIFT |
| Novo Banco | Traditional bank | Low (Visit Required) | 2–5 business days (fintech banks: 1–2 days) • EUR 0–50/month (varies by bank; fintech often EUR 10–20) • EUR 0–500 (many banks have no minimum for business accounts) • Passport, business registration (RNPC), proof of address, proof of capital • SEPA transfers, cards, checks, SWIFT |
Regulatory requirements
Annual Compliance Matrix
| Requirement | Deadline | Details |
|---|---|---|
Audit required | Ongoing | No, unless revenue > EUR 3 million or balance sheet > EUR 1.5 million; simplified accounting regime for smaller firms |
Corporate income tax return | Ongoing | Due 31 March (extensions to 15 April available); electronic filing required (eBAF system) |
Annual report deadline | Ongoing | Must file within 25 days of approval by shareholders/members (typically within 120 days of year-end) |
VAT reporting | Ongoing | Monthly/quarterly VAT returns depending on revenue (monthly if > EUR 650,000) |
Shareholder/member meeting | Ongoing | At least one annual general meeting required; documented and filed |
Financial records retention | Ongoing | 5 years; electronic records acceptable |
Simplified accounting regime | Ongoing | Available for LDAs with revenue < EUR 200,000; significantly reduces reporting burden |
Payroll filings | Ongoing | Monthly if employees; payroll tax withholding and social contributions mandatory |
Frequently Asked
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