Portugal


History of Portugal as an independent state traces back to 1143, when it was established as an independent kingdom from the kingdom of Leon in 1143. In the 15th and 16th centuries, as the result of pioneering the Age of Discovery, Portugal expanded western influence and established the first global empire, becoming one of the world's major economic, political and military powers, and ultimately dividing the world with Spain. The Portuguese Empire was the longest-lived of the modern European colonial empires, spanning almost 600 years, from the capture of Ceuta in 1415 to the handover of Macau to n 1999 (de facto) or the granting of sovereignty to East Timor in 2002 (de jure). The empire spread throughout a vast number of territories that are now part of 53 different sovereign states. Portugal's international status was greatly reduced during the 19th century, especially following the Independence of Brazil, its largest and most important colony ever. After the 1910 revolution deposed the monarchy, the democratic but unstable Portuguese First Republic was established. Democracy was restored after the Portuguese Colonial War and the Carnation Revolution in 1974. The revolution in 1974 also resulted in the independence of Angola, Mozambique, São Tomé and Príncipe, Timor-Leste, Cape Verde and Guinea-Bissau in 1975. Portugal is one of the founding members of NATO and a member of the EU since 1986.

Service packages

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Service item Express Standard Optimum
Company registration
Legal address per year
Secretarial services for the first year
Fees and duties for the first year
Apostilled bound set of incorporation documents
Compliance fee
Nominee service per year
Bank Account Pre-approval
Price

9 090 USD

18 425 USD

18 925 USD

I want to order «»

Contact method: and / or

Core Services

7 500 EUR

— Incorporation

including incorporation tax, state registry fee, including Compliance fee

Included

— Annual government fees

Stamp Duty and Companies Registry Office incorporation fee

6 500 EUR

— Corporate legal services

including registered address and registered agent, NOT including Compliance fee

150 EUR

—Delivery of documents by courier mail

DHL or TNT, at cost of a Courier Service

500 EUR

— Apostilled set of Statutory documents

Optional services

from 4 900 EUR

Local Director Services

from 2 800 EUR

Manager Services

Related services

Tax Certificate

Company’s tax residence certificate for access to double tax treaties network

Certificate of Good Standing

Document issued by a state agency in some countries (Registrar of companies) to confirm a current status of a body corporate. A company with such certificate is proved to be active and operating.

Certificate of Incumbency

Compliance fee

Compliance fee is payable in the cases of: renewal of a company, liquidation of a company, transfer out of a company, issue of a power of attorney to a new attorney, change of director / shareholder / BO (except the change to a nominee director / shareholder)

250 USD

Basic

simple company structure with only 1 physical person

50 USD

For legal entity in structure under GSL administration

additional compliance fee for legal entity in structure under GSL administration (per 1 entity)

100 USD

For legal entity in structure not under GSL administration

additional compliance fee for legal entity in structure NOT under GSL administration (per 1 entity)

350 USD

For client with high risk Status

Cost of incorporation, including first year servicing 9090
Cost of nominee director services per year, including an apostilled set of documents 5940
Cost of nominee shareholder services per year, including an apostilled set of documents 3395
Cost of annual service, starting from the second year 7880
Open account in 26764
Incorporation timescale for a turnkey company 1 week
Country 26722

General information shortly

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Total area Population Capital Unemployment Corruption perceptions index rank
92.151 sq.km 10.799.270 (2013) Lisbon 16.4% (2013) 33
Location Southwestern Europe
National currency Euro
Conditional reduction of currency EUR
Against USD 0.73
Climate, average max and min t° subtropical, Mediterranean; avg. temperature in January – 5-10°C; avg. temperature in July +20-27°C
Time difference from Moscow - 4 hours
Dialing code +351
State language Portuguese
Ethnic groups Portuguese (87%); citizens of African and Asian descent (12%); small quantity of Spaniards andmigrants from Eastern Europe
Literacy rate 93%
Credit rating BB
Government type parliamentary republic
Executive branch Council of Ministers (Prime Minister and ministers)
Legislative branch Assembly (230 memebers)
Judicial branch Supreme Court; judicial tribunal of second instance; judicial tribunal of first instance
GDP per capita rank 38 (2012)

Corporate info

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Shelf companies permitted Legal system Incorporation timescale for a turnkey company Cyrillic alphabet permitted in company name Local registered office
Yes civil law 1 week No Yes
Types of entity sole proprietor (Empresário em Nome Individual); individual limited liability establishment (Estabelecimento Individual de Responsabilidade Limitada); partnership company (Sociedade em Nome Coletivo); limited partnership company (Sociedades em Comandita); cooperative; limited liability company (Sociedade por Quotas); public limited company (Sociedade anônima ); branch of a foreign entity
Incorporation timescale for a new company 1 day
Company suffix Lda
Sensitive words identical or similar names, misleading words, authority, bank and related words
Local registered agent No
Information to be kept at the registered office all financial and fiscal documents, registers, company papers etc., they may also be kept in digital form
Seal required, type of seal not required
Redomiciliation (to, from) permitted permitted

Director and secretary

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Minimum number of directors Residency requirements for directors Corporate directors permitted Disclosure to local agent Disclosure to public
1 No Yes Yes Yes
Directors’ meetings/frequency/location No requirements
Company secretary required No, but recommended if there is a non-resident director
Residency requirements for a secretary No
Qualified secretary required Yes
Corporate secretary permitted No

Shareholder and beneficiary

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Minimum number of shareholders Residency requirements for shareholders Corporate shareholder permitted Disclosure to local agent Disclosure to public
2 No Yes Yes Yes
Meetings/frequency/location Yes / annually / no requirements
Beneficiary info disclosure to No

Shares and share capital

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Minimum authorized share capital Minimum issued share capital Minimum paid share capital Authorized capital payment deadlines Bearer shares permitted
2 2 2 No requirements No
Issued capital payment deadlines Before the end of the first financial year
Standard currency EUR
Standard authorized share capital 2
Standard par value of shares 1
Shares with no par value permitted No

Taxes

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Min. rate for corporate tax Capital gains tax VAT Withholding tax Exchange control
21% Regular rate 23% 25%/25%/25% No
Personal tax 14,5-48%
Corporate tax (in detail) The standard tax rate is 21%. In some regions and for small enterprises, the rate may be lower in terms of part of income.
Capital gains tax. Details Capital gains are included in the general tax base
VAT. Details Стандартная ставка НДС составляет 23%. В отношении некоторых товаров и услуг применяются пониженные ставки в размере 13% и 6%
Other taxes Social contributions, Municipal property tax, Property transfer tax
Stamp duty Rates vary by transaction

Accounts

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Requirement to file accounts Publicly accessible accounts Audit required Requirement to file Annual Return Publicly accessible Annual Return
Yes Yes No No No
Requirement to prepare accounts Yes
Double tax treaties network 81
Tax Exchange Information Agreement network 11
OECD member Yes
Offshore/onshore status according to the RF laws No

GENERAL INFORMATION

General info

The Portuguese Republic is a country located in South-Western Europe and is the westernmost country of mainland Europe.
Total area of Portugal is 92.151 sq. km. Population of Portugal is 10 799 270 people (2013). Most of the population is Portuguese (87%), others include citizens of African and Asian descent (12%) and a small quantity of Spaniards, and migrants from Eastern Europe.
Official language of Portugal is Portuguese.
Official currency is Euro.
Climate of Portugal is subtropical, Mediterranean. Average temperature in January is 5-10°C; average temperature in July is +20-27°C. Precipitation in the plain area ranges from 400 to 800 mm, in the mountain area – from 100o to 2500 mm a year.
Time difference with Moscow is -4 hours.
Literacy rate is 93%.
Calling code of Portugal is +351.

History

History of Portugal as an independent state traces back to 1143, when it was established as an independent kingdom from the kingdom of Leon in 1143. In the 15th and 16th centuries, as the result of pioneering the Age of Discovery, Portugal expanded western influence and established the first global empire, becoming one of the world's major economic, political and military powers, and ultimately dividing the world with Spain.
The Portuguese Empire was the longest-lived of the modern European colonial empires, spanning almost 600 years, from the capture of Ceuta in 1415 to the handover of Macau to n 1999 (de facto) or the granting of sovereignty to East Timor in 2002 (de jure). The empire spread throughout a vast number of territories that are now part of 53 different sovereign states.
Portugal's international status was greatly reduced during the 19th century, especially following the Independence of Brazil, its largest and most important colony ever. After the 1910 revolution deposed the monarchy, the democratic but unstable Portuguese First Republic was established. Democracy was restored after the Portuguese Colonial War and the Carnation Revolution in 1974. The revolution in 1974 also resulted in the independence of Angola, Mozambique, São Tomé and Príncipe, Timor-Leste, Cape Verde and Guinea-Bissau in 1975.
Portugal is one of the founding members of NATO and a member of the EU since 1986.

Government Type

By government type Portugal is a parliamentary republic.
Head of State is a President. The President is elected to a five-year term. Theoretically, he has a great power, even a right to dissolve Parliament, but nowadays his powers are more representative. There is a consultative body subject to the President – State Council (Conselho de Estado).
Executive power is exercised by the Council of Ministers which consists of Prime Minister and ministers, and is subject to the Assembly.
Legislative power belongs to the Assembly (Assembleia da República), which consists of 230 deputies (deputados) and is elected for a 4-year term.
which comprises two houses: the Senate and the House of Representatives. The National Assembly has 630 members.
Judiciary power is composed of courts which are organized into several levels: judicial, administrative, and fiscal branches. The Supreme Courts are institutions of last resort/appeal. A thirteen-member Constitutional Court oversees the constitutionality of the laws.

Economy

The Economy of Portugal is of a mixed nature. The most important traditional industries are textile, sewing, winemaking, production of olive oil, tinned fish, processing of croak-oak bark. In agriculture farming prevails. Most imports come from the European Union (EU) countries of Spain, Germany, France, Italy, and the United Kingdom, while most exports also involve other EU member states.
Economic policy is aimed at liberalization and modernization of economy, further privatization of state-owned enterprises, restructuring of banking and telecommunication sector. However, the Financial Crisis of 2008 continues to severely affect the Portuguese economy. The crisis has caused a wide range of domestic problems that are specifically related to the levels of public deficit, as well as the excessive debt levels, in the economy. In 2013 unemployment rate was 16.4%. Thanks to export growth in the second quarter of 2013 economy growth of Portugal was the highest among the other EU members – GDP increased 1.1% by the first quarter, while before the economy had been in recession for 10 quarters in a row. By GDP (PPP) Portugal ranks 38th in the world.

CORPORATE INFORMATION

Legal system

The Portuguese legal system is a civil law or continental legal system, based on Roman law. Portuguese law is mainly influenced by French law. EU law is now a major driving force in many respects, such as corporate law, administrative law and civil procedure.
Basic corporate Law of Portugal is found in the Commercial Code (1888, as amended).

Types of entity

Under Portuguese legislation, the following types of commercial entities may be established in Portugal to carry on business:
  • sole proprietor (Empresário em Nome Individual);
  • individual limited liability establishment (Estabelecimento Individual de Responsabilidade Limitada);
  • partnership company (Sociedade em Nome Coletivo);
  • limited partnership company (Sociedades em Comandita);
  • cooperative;
  • limited liability company (Sociedade por Quotas);
  • public limited company (Sociedade anônima );
  • branch of a foreign entity.

The most common type is limited labiality company (Lda.).

REGISTRATION

Company name

The usual company name format in Portugal is “Name – Business Activity, Extension”, but the business activity component is now optional and many newly incorporated companies are dropping it. As regards the extension, a quota company must end its name with Lda. If the quota company has a single quota holder, then the name must end with “Unipessoal, Lda”.
In the event you do not have a preferred name, a "pre-approved name" will be adopted. This is a fantasy name from a list that is put together and regularly updated by the company registry office, from which anyone can choose a company name that will not be challenged for being confusable. Names on this list cannot be reserved and will be allocated on a first-come, first-served basis.
If a specific name is to be adopted, you can either adopt the name(s) of the main shareholder(s) or a fantasy name of your choice. In the latter case you should provide at least 3 alternative names, as the registrar has to ensure that it shall be unique and not confusable with an existing company name. The name may be any name in any language, but it must in the Roman alphabet and must not be misleading, contain sensitive words, or suggest an activity subject to special authorization (e.g. financial).

Registration

There are two ways of starting a business in Portugal:
1) "On the Spot Firm" (Empresa na Hora). This service enables to set up a company in less than an hour at a single contact point:, all the procedures are carried out in one place and as long as the partners have all of necessary documents, the company is set up immediately at one of the desks of the On the Spot Firm, available throughout the country, regardless of the location of the company’s headquarters. Registration procedure includes the following steps:
  • Choose a name from the list of pre-approved names available at the website On the Spot Firm, or check the list that is available at the On the Spot Firm’s desk. The name chosen will only be kept until you come to the desk and start the setting-up process.
  • Choose one of the pre-approved standard memorandum and articles of association packs, available at On the Spot Firm and in the portfolio of packs available at the desks.
  • Obtain a certificate of incorporation, the corporate identification card, the Social Security number, the deed, and a business registration certificate. For tax purposes, the declaration of commencement of activity can be submitted at the help desk, duly signed by the accountant. If this is not submitted right away, it must be done within 15 days of the incorporation.

Incorporation under "Empresa na Hora" costs EUR 360.
2) "Online company setting up” (Empresa Online). This service enables to set up a company through the Internet in 1 to 2 days. The access to the service On-Line Company (‘Empresa Online’) can be made through the Business Portal (www.portaldaempresa.pt).
Incorporation under "Empresa na Hora" costs EUR 360 if not incorporated with pre-approved by-laws, or EUR 220 if incorporated with pre-approved by-laws.
After incorporation the employers must register with the social security regional center. The employers shall communicate the admission of employees to the Portuguese Social Security services of the area of the employee's workplace, by any written means, or online at www.seg-social.pt, within (i) 24 hours preceding the employment agreement’s entry into force; or (ii) 24 hours following the beginning of the activity. The non-compliance with this obligation implies the assumption that the relevant employee started to work for the company on the 1st working day of the sixth month prior to the occurrence of the infringement. In case the relevant employee is receiving sickness or unemployment benefits there is also an assumption that the employ started to work for the company on the date in which those benefits were granted, whereby the company will be severally liable for returning the whole amounts unduly received by the employee by the Portuguese Social Security. Moreover, the non-compliance with the above mentioned obligation may result in a minor or a serious misdemeanor, depending on its compliance within 24 hours after the deadline or after that, corresponding to a fine from € 75 up to € 4,800.

Local registered office

All Portuguese businesses need a registered office where the authorities can send official letters and claims, as well as where control of the tax forms is executed. All financial and fiscal documents, registers, company papers etc. must be kept at the registered office of the business, but they may be kept in digital format.

Seal

Under Portuguese law, a company is not required to have a corporate seal. The standard practice is to have a rubber stamp, but even this is becoming less common.

Redomicile

The redomiciliation of companies either to or from Portugal is permitted.

COMPANY STRUCTURE

Directors

In Portuguese companies at least one director is required. There are no legal restrictions on the nationality or place of residence of Portuguese company directors. But please note that each of them has to have or obtain a Portuguese taxpayer identification number and that non-EU/EEA entities must have a resident tax representative.
Corporate directors are permitted, but in this case an individual representative of the corporate director must be appointed and registered with the registry office.
It should be noted that under Portuguese law a company director can be personally jointly liable with the company in connection with any company's unpaid taxes and social security contributions that originated or became due during his/her term as a director. For this reason, the availability of nominee directors is very scarce, those available are relatively highly paid and as a rule will not issue general powers of attorney - only specific ones.
There are no requirements to meeting of Board of directors.
Names of directors do appear in public records.

Secretary

For Portuguese limited companies, secretary is optional, but it is recommended in the event that the company does not have a Portugal resident director. The secretary is appointed by the general meeting of quota holders. The secretary is appointed for the same term as that of the officers that appointed him/her.
The secretary must be an individual, must hold a “suitable academic degree” and, except in the case of companies belonging to the same group of companies, may not act as the secretary of more than 7 companies.

Shareholders

A Portuguese limited company must have at least 2 shareholders. There are no legal restrictions on the nationality or place of residence of the shareholders of a Portuguese company and they may be either individuals or corporate bodies. But please note that each of them has to have or obtain a Portuguese taxpayer identification number and that non-EU/EEA entities must have a resident tax representative.
Names of shareholders do appear on public records.
Shareholders must hold General Assembly annually to approve the annual financial statements within 3 months from the close of the fiscal year to which it relates.

Beneficiary

Information on beneficiary is not disclosed.

Share capital and shares

Since January 2011, there is no minimum capital required for Limited Liability Companies in Portugal. Partners must define a certain amount which is represented by “quotas” (shares), each one with a minimum value of € 1.00 and may assume different values.
Shares in a private company are usually transferred by a written agreement duly registered at the appropriate Registry Office.
Bearer shares and shares with no par value are not allowed.

TAXATION

Personal income tax

Portuguese tax residents pay tax on their worldwide income and non-residents on income from sources in Portugal.
Non-residents are subject to 25% tax on their remuneration.
Income tax is paid at progressive rates:
  • Income up to EUR 7,112 – 14.5%
  • Income from EUR 7,112 to 10,732 – 23%
  • Income from EUR 10,732 to 20,322 – 28.5%
  • Income from EUR 20,322 to 25,075 – 35%
  • Income from EUR 25,075 to 36,967 – 37%
  • Income from EUR 36,967 to 80,882 – 45%
  • Income over EUR 80,882 – 48%

Taxpayers with an income of more than EUR 80,000 pay an additional solidarity tax at 2.5% to 5% rate.
Investment income is taxed at 28%, but there is an option to pay tax at progressive rates. If a bank account or investment is located in a jurisdiction blacklisted by Portugal as a “tax haven”, a higher tax rate of 35% applies.
Capital gains are generally taxed at the rate of 28%.
Fifty per cent of capital gains from the sale of real estate are included in the taxable income and taxed at progressive rates. There is a relief for the primary residence.
Non-residents are taxed at 28% rate on 100% of the profits from the disposal of Portuguese assets.
Individuals who have moved to Portugal are eligible for a special preferential tax regime, subject to certain conditions. Their remuneration for work in a number of industries can be taxed at the rate of 20%, and their foreign income is exempt from taxation.

Corporate income tax

Corporate income tax is paid on the company’s worldwide income.
There is an optional regime to exclude from the tax base the profits and losses allocated to foreign permanent establishments, subject to certain conditions.
The standard tax rate is 21%. The rate may be lower in some regions and for small businesses in relation to some part of the income.
There is a state surtax levied at rates from 3% to 9% on profits exceeding certain thresholds, as well as surtaxes of up to 1.5% at the level of municipalities. Some regions also charge a regional surtax.
In relation to some expenses (representation expenses, undocumented expenses and others), companies are required to pay tax calculated as a percentage of such expenses.
Dividends received are exempt from tax if the conditions for the substantial participation exemption are met: the participation interest is at least 10%, the holding period is at least 1 year, the company is not from a "blacklisted” country and is subject to corporate income tax specified in the EU Parent-Subsidiary Directive or at a rate not lower than 60% of the Portuguese rate, and some other conditions.
Capital gains are generally taxed at regular tax rates.
Profit from the sale of shares may be tax exempt if the conditions for the substantial participation exemption are met: the participation interest is at least 10%, the holding period is at least 1 year, the company is not from a "blacklisted” country and some other conditions.

CFC rules

A foreign company is considered a controlled foreign company if a resident owns, directly or indirectly, at least 25% of its capital, voting rights, or rights to its profits and assets, and the company's profit is taxed at a rate below half of the Portuguese corporate income tax rate, or the company is from a blacklisted jurisdiction.
CFC rules may not apply to EU or EEA companies if a company is established for real economic purposes and conducts the relevant business.
Nor should CFC rules apply if the company's passive income does not exceed 25%. Passive income includes not only interest, dividends, profits from the sale of securities, etc., but also profits from trading with related parties.

Withholding tax

Withholding tax on dividends and interest is 25%.
The rate rises to 35% if the recipient is from a blacklisted country. Dividends can generally be exempt from tax if the recipient is from a DTT (double tax treaty) country or from an EU or EEA member state, is taxed in the country of residence at a rate not less than 60% of the Portuguese rate and has held at least 10% of the Portuguese company’s shares for at least a year.
Royalties are subject to 25% withholding tax.
The tax may be withheld on certain other income payments.
Withholding taxes are reducible under the applicable double tax treaties and EU directives.

VAT

The standard VAT rate is 23%.
Reduced rates of 13% and 6% apply to some goods and services.

Social security contributions

Social security contributions, including contributions to cover pension, family, and unemployment benefits, are paid by employees at the rate of 11% and by employers at the rate of 23.75% of the employee’s remuneration.
Employers must also purchase insurance against occupational accidents; the premiums vary by industry.

Municipal property tax

The annual property tax is generally levied at the rate of 0.8% in rural areas and at the rates from 0.3% to 0.45% in urban areas.
There is also an additional municipal property tax on land for development and residential property.
The rates vary depending on the category of the owner and the value of the property.

Property transfer tax

When transferring real estate located in Portugal, a municipal tax is levied at rates of up to 6.5% for urban real estate, 5% for rural real estate, and 10% if the buyer is a company from a blacklisted country.

Stamp duty

Stamp duties are payable on various transactions and documents.
The rates vary greatly depending on the transaction.

Exchange control

Portugal has no exchange control.

Double tax agreements

Portugal has tax treaties with 94 countries:
81 DTCS: Algeria, Angola, Andorra, Austria, Bahrain, Barbados, Belgium, Brazil, Bulgaria, Canada, Cape Verde, Chile, China, Colombia, Croatia, Cuba, Cyprus, Czech Republic, Cote d'Ivoire, Denmark, Estonia, Ethiopia, Finland, France, Georgia, Germany, Greece, Guinea-Bissau, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Korea (Republic of), Kuwait, Latvia, Lithuania, Luxembourg, Macao (China), Malta, Mexico, Moldova, Montenegro, Morocco, Mozambique, Netherlands, Nigeria, Norway, Pakistan, Panama, Peru, Poland, Oman, Qatar, Romania, Russian Federation, San Marino, Saudi Arabia, Senegal, Singapore, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, Sao Tome and Principe, Timor-Leste, Tunisia, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States, Uruguay, Venezuela, Vietnam.
11 TIEA: Andorra, Antigua and Barbuda, Bermuda, British Virgin Islands, Cayman, Islands, Gibraltar, Liberia, St. Kitts and Nevis, St. Lucia, Turks and Caicos.

ACCOUNTS

Financial statements

Every Portuguese company is required to prepare annual financial statements which must be approved by the general meeting of members within 3 months of the financial year-end. Publication of financial statements is not mandatory, but they must be filed electronically by the end of June. Filing is done by an accountant.
Financial statements must be prepared in accordance with Portuguese Chart of Accounts. They should include a balance sheet, income statements, a cash flow statement, etc.
Financial statements are publicly accessible.

Audit

Limited liability companies are generally exempt from audit of their financial statements. However, if a company exceeds two of the following three thresholds during two consecutive years, it must appoint a registered auditor (“Revisor Oficial de Contas”) for the purpose of auditing the financials:
  • Amount of income: EUR 3 million;
  • Net assets: EUR 1.5 million;
  • Number of employees: 50.

Annual Return

As Russian law does not have an equivalent of the Annual Return, we think it appropriate to explain this concept. The Annual Return is a summary of the company’s current structure prepared annually by the company secretary. It usually includes:
  • incorporation information (date of registration, registered office);
  • details of the directors and their resignations;
  • details of the secretaries and their resignations;
  • details of the authorized capital, par value of shares, and number of shares issued;
  • details of the shareholders and share transfers.

Portugal does not have a requirement to file an Annual Return.

Tax returns

The tax year corresponds to the calendar year. There may be exceptions in some cases.
Corporate income tax returns are filed electronically by the end of May of the year following the reporting year.
Three advance tax payments are made during the year. The final payment is due upon filing the annual tax return.

INVESTMENT VISA

Investment and a Residence Permit

The Portuguese authorities, through Law n. 29/2012, of August 9th approved the legal regime through which it is now possible for Non-EU nationals to obtain a residence permit for the development of an investment activity in Portugal. Non-EU country nationals can apply for a residence permit in Portugal for the purposes of carrying out an investment activity provided the legally required criteria are met. In order to obtain the Investment Visa, Non-EU nationals must:
  • hold a valid Schengen visa when entering Portugal;
  • formalize their stay in Portugal within 90 days counting from the date of the first entry (by applying for the “investment visa”);
  • carry out an “investment activity”.

The approved Law defines as an “Investment activity” any activity carried out by a Non-EU country national, personally or through a company, that leads to the fulfillment of at least one (1) of the following conditions in Portuguese territory:
  1. Capital transfer of at least €1M; or
  2. Creation of, at least, 10 jobs; or
  3. Acquisition of (1 or more) real estate with a value of at least €500k.

Such investment activity must last at least 5 years.

Renewal of the Residence Permit

The requirements of the Ministry of State for Foreign Affairs and Ministry of the Interior confirms that the applicants/investors, for the purposes of renewing their residence permits, should prove they have met the following minimum periods of stay in Portugal:
  • 7 days in the first year and;
  • 14 days in the subsequent periods of two years (again 7 days per year).

After a period of 6 years legally residing in Portugal it is legally permitted for individuals to apply for the Portuguese citizenship further being granted with a Portuguese Passport. There is, however, a requirement to have sufficient knowledge of the Portuguese language.

Combining Investment Visa with NHR –Non Habitual Residents

There is therefore the possibility for a Non-EU country national to simultaneously apply for the NHR and the Investment regime.
The NHR status can be granted to individuals, who become resident for tax purposes in Portugal, provided they have not been residents in Portugal for the previous five years. NHR individuals may enjoy such status for a ten-year period, after which they will be taxed under the standard personal income tax rules in Portugal regime.
Under the NHR regime, income deriving from employment or independent personal services of a domestic source or from a foreign source, if not exempt, will be taxed at a special 20% flat rate. Employment income not originated in Portuguese territory will be exempt from personal income tax in Portugal, if the source country taxes the relevant income under the terms of a Tax Treaty celebrated by Portugal with said country, or, should there be no tax treaty in place, if the income is taxed in the other country and the income is not considered to be obtained in Portugal.
Pensions enjoy a ten-year exemption if taxed by the source state under existing tax treaty, or, if there is no treaty, there does not exist any connection of the income with the Portuguese territory under the rules for the personal income tax rules in Portugal.
The passive income received by NHR’s will be exempt from personal income tax in Portugal, although it may be taxed in the Origin State under the rules of a tax treaty entered into by Portugal. If no treaty exists, such income:
  • may be taxed in the source State; and
  • will not be taxed if not considered to arise from a Portuguese source; and
  • will not be taxed if the source State, region or territory is not included in the Portuguese tax havens’ black list.

The regime requires only that there is potential taxation in the source State, therefore no effective taxation is required. The passive income included in this regime comprises interest, dividends, capital gains, other income from capital, income from immovable property and pensions. Example: individual granted with the NHR regime that receives interest from a bank in UK will be subject to the following tax treatment:
  • Interest won’t be taxed in the UK as he is a (non-habitual) resident of Portugal;
  • As there is a Tax Treaty in place between the UK and Portugal such income will be exempt in Portugal.

International law relations

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Party to the Hague Convention (Apostille) Legal system Double tax treaties network OECD member Offshore/onshore status according to the RF laws
Yes civil law 81 Yes No

Public authorities and legal acts

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List of laws and regulations
Act name Scope of law
Commercial Companies Act commercial companies
Corporate Income Tax Code corporate tax
Personal Income Tax Code personal tax
Decree-Law n.313/93 prevention of the use of the financial system for the purpose of money laundering
Decree-Law No. 500/80 creation of a free trade zone in Madeira
Regulatory Decree No. 53/82 operations in Madeira
Act n. 29/2012 residence permit
Regional Regulative Decree no. 21/87/M industrial, commercial and service activities, integrated within the scope of Madeira’s Free Zone
Decree-Law no. 212/94 constitution and permanence of companies licensed to operate in the Madeira Free Zone
Decree-Law no. 250/97 registration and publication the revocation and forfeiture of licenses granted to entities operating in the Madeira Free Zone
Decree-Law no. 352-A/88 уestablishment and operation of companies or branches of offshore trusts in the Madeira Free Zone
Decree-Law no. 149/94 incorporation of fiduciary management instruments (trusts)
Ordinance of the Autonomous Region of Madeira no. 222/99 tax rates for entities licensed to operate within the institutional framework of the International Business Centre of Madeira
Decree-Law no. 96/89 establishment of the International Shipping Register of Madeira
Ordinance no. 715/89 International Shipping Register of Madeira
Decree-Law no. 192/2003 recreational crafts registered or to be registered in the International Shipping Register of Madeira
Ordinance no. 134/92 tax rates for merchant ships registered in the International Shipping Register of Madeira
Ordinance no. 135/94 applicable taxes for recreational crafts registered under the International Shipping Register of Madeira
Tax treaties entered Algeria, Angola, Andorra, Austria, Bahrain, Barbados, Belgium, Brazil, Bulgaria, Canada, Cape Verde, Chile, China, Colombia, Croatia, Cuba, Cyprus, Czech Republic, Cote d'Ivoire, Denmark, Estonia, Ethiopia, Finland, France, Georgia, Germany, Greece, Guinea-Bissau, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Korea (Republic of), Kuwait, Latvia, Lithuania, Luxembourg, Macao (China), Malta, Mexico, Moldova, Montenegro, Morocco, Mozambique, Netherlands, Nigeria, Norway, Pakistan, Panama, Peru, Poland, Oman, Qatar, Romania, Russian Federation, San Marino, Saudi Arabia, Senegal, Singapore, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, Sao Tome and Principe, Timor-Leste, Tunisia, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States, Uruguay, Venezuela, Vietnam
Tax Exchange Information Agreement (TEIA) Andorra, Antigua and Barbuda, Bermuda, British Virgin Islands, Cayman, Islands, Gibraltar, Liberia, St. Kitts and Nevis, St. Lucia, Turks and Caicos
List of state regulatory authorities
Portuguese Government https://www.portugal.gov.pt/pt/gc21
Ministry of Finance https://www.portugal.gov.pt/pt/gc21/area-de-governo/financas
Bank of Portugal https://www.bportugal.pt/en
Portuguese Business Portal https://bde.portaldocidadao.pt/evo/LandingPage.aspx
Portugal Trade & Investment Agency http://www.portugalglobal.pt/EN/Pages/Index.aspx
Portuguese Tax administration http://www.portaldasfinancas.gov.pt/at/html/index.html

    Legal Partner of Review:

    Belion Partners

    Belion Partners is a boutique professional services firm having offices in London, UK, and Lisbon, Portugal. The firm provides services in connection with investing in Portuguese real estate and unlisted companies, doing business in Portugal and relocating to Portugal, including corporate and fiduciary services, search and buying services and residency services (investors' visas and tax-efficient residency).

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