Doing business in Portugal can very shortly prove to be a profitable line of operation with remarkable opportunities to grow and develop. This is made possible by the status of reputable jurisdiction, access to the EU market and a transparent tax system. Portugal holds in both its own entrepreneurs and foreign investors in high esteem. No special restrictions apply to foreign shareholders or directors in Portugal. This country has agreements with more than 50 other countries for the reciprocal protection and promotion of investments, and agreements with 79 countries for the avoidance of double taxation.
We offer you a step-by-step guide on how to open a company in Portugal.
Step 1 to incorporating a company in Portugal: Decide on the type of business and know your customers
It is a universal knowledge that Portugal is highly popular among tourists. No wonder, as we are talking about a country with exquisite combination of historical heritage and warm climate with an ocean breeze. Needless to say, that tourism on the rise provides great business opportunities for small and medium business such as restaurants, cafes, bars or travel agencies. On the other hand, large business giants, such as IKEA, Microsoft or Colt , have additional factories and service centers in Portugal, as they plan to benefit from the favorable tax environment this country offers.
Portugal also offers low operating costs, including a highly educated population (42% of which speak at least one foreign language), a skilled but cheap labor force (50% of the EU average cost), and highly developed infrastructure and communications networks. Last but not the least, the country is a potential gateway to a market of about 250 million people in the Portuguese speaking countries and communities.
Step 2 to incorporating a company in Portugal: Register a company name or find it in the Registry of Business Names of Portugal
If 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 in Portugal, from which anyone can select a company name that will not be challenged and will be acceptable. Note however, that names on this list cannot be reserved and will be distributed on a first-come, first-served basis.
Another option is to register your own company name. To this end, you will need to pay state fee and wait (about 15 days) for the completion of registration procedure.
Step 3 to incorporating a company Portugal: Prepare corporate documents
In Portugal, Articles of Association is the principal document for any organization. You start its preparation even before the company registration procedures. It includes, in particular, the following information:
- Portuguese company name;
- Names, surnames, country of residence, nationality of owners;
- Business scope;
- Company management processes.
In addition, notarized copies of passports of the owners and evidence of their place of residence will be required.
Step 4 to incorporating a company Portugal: Obtain an individual Tax ID
Portuguese law requires citizens to obtain their own tax identification number.
An individual’s tax identification number may be obtained by the individual from any tax office or from a “Citizen’s Shop” (Loja do Cidadão). You will be required to present an original passport (or national identity card if an EU citizen); or it may be obtained by the individual’s tax representative, who will need a legalized copy of the represented person’s passport (or national identity card if an EU citizen) plus a power of attorney.
Non-residents from third countries must undergo a special tax procedure. It is very important to have a tax representative from Portugal: otherwise it will not be possible to obtain Tax ID.
We offer assistance in finding a reliable representative. Contact us at: firstname.lastname@example.org
Optional Step: Get Access to the Permanent Business Certificate (PBC)
This step is optional, but we still recommend accessing this certificate. This is an analogue of the Good Standing certificate and serves as a qualitative proof of reliability when dealing with the banks. It is extremely important if you want to open an account in Portugal, but it will be also come in handy when opening an account abroad.
Step 5 to incorporating a company Portugal: Registration in the Commercial Register
One of the owners, director or other official representatives are required to submit the documents to the commercial register. Tax ID is required at this stage. The list of documents should include:
- Certificate evidencing the company name;
- Articles of Association and other corporate documents;
- If required, additional documents (for example, the auditor’s report on the property transferred to the authorized capital).
Company registration may take up to 10 business days unless you require additional services.
Step 6 to incorporating a company Portugal: Get a Corporate Tax ID
Registration of a legal entity as a taxpayer is a mandatory procedure in Portugal. It is impossible to conduct business without a corporate tax identification number.
For business entities, the tax identification number is simultaneously the corporation tax reference number, the VAT registration number and the company registration number. The number is provided upon setting up a company or registering a permanent establishment. Otherwise, it may be obtained in person or by mail from the National Company Registry office (Registo Nacional de Pessoas Colectivas or RNPC), or online. For this purpose, the individual applicant is required to produce documentary evidence of the company’s existence and of the individual’s power to apply for the number in the company’s name.
A resident tax representative will be the person in charge of preparation and filing of the represented person’s annual tax returns and in general represent the client before the tax authorities. But having a local tax representative is mandatory only for a non-EU/EEA resident individual or business.
Step 7 to incorporating a company Portugal: Set up accounting process
Accounting plays a crucial role in the business continuity of the company in the jurisdiction of Portugal.
A chartered accountant (contabilista certificado) should be appointed upon the incorporation of a company or the registration of a branch, so that he/she can sign and file the business activity commencement form with the tax authorities within the following 15 days.
Resolving this issue and establishing competent cooperation is a task with a high degree of importance.
On average, accountant services cost 3,600 EUR per year.
In addition to mandatory accounting, each company is required to have its own legal address. We will help you identify qualified accounting service as well as established legal address.
If you have any further questions, we will be happy to provide further guidance at email@example.com.
If you have answers to all your questions, do not hesitate to apply for our services of incorporating a company in Portugal. We will make sure that the whole procedure is performed remotely without your personal visit to Portugal. Stay informed by contacting us firstname.lastname@example.org.