How to Start a Business in Portugal as a Foreigner

This guide explains starting a business in Portugal as a foreigner in 2026: visas, company structures, registration, tax and social security.

What changed in 2025 and 2026

For foreign founders, the main changes are a rewritten foreigners law that creates residence permits for entrepreneurship, higher minimum staff costs, and the defeat of a Labour Code reform that many employers had expected.

Change	Date in force	What it means for you
Law 61/2025 amends the foreigners law	Published 22 October 2025	Introduces residence permits for entrepreneurship and raises the deadline for AIMA decisions from 180 days to nine months.
Job-seeker visa replaced by a visa for skilled job seekers	Appointments cancelled from 23 October 2025	Recruiting non-EU staff who are not yet in Portugal now depends on a work visa or the new skilled job-seeker visa once it is regulated.
Transitional “expression of interest” regime closes	31 December 2025	Non-EU staff can no longer regularise after starting work for you; they need the right visa first.
Minimum wage rises to €920 a month	1 January 2026	Your lowest-paid employees cost at least €12,880 a year in salary, plus 23.75% employer social security.
Labour Code reform defeated in Parliament	19 June 2026	Existing employment rules still apply; some measures are returning as separate bills.
Minimum wage of €970 proposed	Proposed for 1 January 2027	Budget for a further €50 a month per minimum wage employee, with rises planned to up to €1,100 in 2029.

Who can start a business in Portugal: EU and non-EU founders

Anyone, of any nationality, can own shares in a Portuguese company. The question is whether you can live in Portugal and work in the business, which depends on your residence status.

Founder	Can own a Portuguese business?	Can live in Portugal and run it?
EU, EEA or Swiss citizen	Yes	Yes, with registration as a resident after three months
British national resident before 1 January 2021	Yes	Yes, under the Withdrawal Agreement
British, US or other non-EU national	Yes	Only with a residence visa and permit that allow self-employment or entrepreneurship
Non-resident owner of any nationality	Yes	Not applicable; the company still needs a head office in Portugal

The Empresa na Hora service accepts a passport, a Portuguese citizen card or a residence permit as identity documents for individual partners, together with a NIF. That means a non-resident can be a partner in a new company, provided all partners attend the counter in person, or are represented.

A visa-free visit of up to 90 days in 180 allows business meetings, according to the FCDO’s entry advice, but not work. Viewing premises, meeting an accountant and signing company documents are generally fine on a visit; running the business day to day is not.

Visa routes for non-EU entrepreneurs

Non-EU founders usually come in on a residence visa for independent work or entrepreneurship, on the Startup Visa for innovative companies, or, if they keep a business abroad, on the D7 or D8 visa.

Route	Who it suits	Key condition	Notes
Residence visa for independent work or entrepreneurship	Freelancers and owners of a new Portuguese business	A viable activity and sufficient means	Law 61/2025 created residence permits specifically for entrepreneurship
Startup Visa	Founders of innovative, scalable companies	Certification through IAPMEI, the agency for small and medium-sized businesses	Not suitable for conventional shops or consultancies
D7 visa	People with passive income, including dividends from a business abroad	Regular passive income	Allows residence; check what work it permits
D8 remote work visa	Founders or employees of businesses outside Portugal	Income from work for clients or employers abroad	Running a Portuguese business needs a different permit

The route you choose decides what AIMA can grant you after arrival, so take advice before you apply. The guide on how to find an immigration lawyer in Portugal explains what a consultation should cover. If you intend to run a business abroad while living in Portugal, compare the D7 visa with the D8 digital nomad visa.

Choosing a business structure

Most foreign founders choose between working as a self-employed individual (trabalhador independente) and forming a private limited company, either a single-member company (sociedade unipessoal por quotas) or a company with two or more partners (sociedade por quotas, Lda).

Structure	Best for	Liability	How profits are taxed
Self-employed individual (trabalhador independente)	Freelancers, consultants, tutors, small trades	Unlimited: your personal assets are at risk	Personal income tax (IRS), often under the simplified regime
Sole trader (empresário em nome individual)	Small commercial businesses run by one person	Unlimited	IRS
Single-member limited company (sociedade unipessoal por quotas)	One owner who wants limited liability	Limited to the company’s assets	Corporate tax (IRC), then tax on dividends or salary you draw
Private limited company (sociedade por quotas, Lda)	Two or more partners	Limited	IRC
Public limited company (sociedade anónima, SA)	Larger ventures, outside investors	Limited	IRC

Self-employment is quicker and cheaper to set up and run, and it suits many freelancers in their first year. A company makes more sense once profits are high enough for the 19% or 15% corporate tax rates to beat the progressive income tax scale, or when you want limited liability or outside investors.

Setting up a company with Empresa na Hora

Empresa na Hora (“company on the spot”) lets you create a sociedade por quotas, a single-member company or an SA at a single counter in a single visit, for a standard fee of €360.

The Ministry of Justice’s registration service describes the steps as follows.

1. Get a NIF for every partner. Individual partners need an identity document and a Portuguese tax number. Corporate partners need their legal entity card or access code, a resolution authorising their representatives, and their articles of association.
2. Choose a name and articles. At the counter you pick a pre-approved company name and standard articles of association (pacto social).
3. Attend the counter together. All future partners must be present, at any Empresa na Hora counter, wherever the head office will be. Appointments can be booked online.
4. Pay in the share capital. Deposit it beforehand in the company’s bank account, or within five business days of incorporation. Alternatively, partners can declare that the capital will be delivered to the company by the end of the first financial year.
5. Receive your documents. You leave with the articles of association, an access code for the permanent commercial certificate, an access code for the company card and the company’s Social Security number.
6. Declare the start of activity. If you did not appoint a certified accountant at the counter, you have 15 days to file the start-of-activity declaration with the tax authority (Finanças).
7. File the beneficial owner declaration. You must register the company’s beneficial owners in the Central Register of Beneficial Owners (RCBE) within 30 days.

Empresa na Hora fee	Cost
Standard company creation	€360
Creation with a trademark in one class of products or services	€200
Each additional trademark class	€44
Capital contributed in assets other than cash	Additional registration fees for each asset

Once the commercial registration is final, managers and directors are automatically given digital attributes, free of charge, that let them sign certain electronic documents for the company with their citizen card or digital mobile key (Chave Móvel Digital).

Registering as self-employed

To work as a self-employed individual, you declare the start of your activity (declaração de início de atividade) with the tax authority, issue electronic invoices or receipts for your work, and register with Social Security.

Step	What you do	Practical point
Tax number (NIF)	Obtain it before anything else	Needed for every registration
Start of activity	File the declaration with the tax authority, choosing the activity codes that match your work	The codes affect your VAT and income tax treatment, so choose them with care
Invoicing	Issue electronic receipts or invoices for each payment	Often called “recibos verdes” (green receipts)
Social Security	Register as a self-employed worker and file quarterly declarations of income	Contributions are 21.4% of a base derived from your income
Annual tax return	Declare your income in the IRS return the following year	Professional income goes in a separate annex of the return

Tax: the simplified regime or a company?

Self-employed individuals with turnover below €200,000 a year (the 2026 limit) can use the simplified regime, which taxes a fixed share of income at progressive IRS rates. Companies pay IRC at 19%, or 15% on the first €50,000 of profit for small and medium-sized companies.

Feature	Simplified regime (IRS)	Company (IRC)
Eligibility	Turnover below €200,000 in the previous year	Any company
Taxable base	75% of income from listed professional services, 35% of other service income, 15% of sales of goods	Accounting profit, adjusted for tax
Tax rate	Progressive IRS scale, 12.5% to 48% in 2026	19%; 15% on the first €50,000 for SMEs; 12.5% for qualifying SMEs in the interior
Surcharges	Solidarity rate of 2.5% above €80,000 and 5% above €250,000	Municipal surcharge (derrama) of up to 1.5%; state surcharge from 3% on profits over €1.5 million
Expenses	A share of the taxable base depends on reporting expenses equal to 15% of gross income	Deductible if incurred for the business
Accounts	No organised accounts needed	Organised accounts prepared by a certified accountant

Sources: PwC Worldwide Tax Summaries, individual pages reviewed 3 October 2026 and corporate pages reviewed 24 July 2026.

Under the simplified regime, part of the taxable base is adjusted upwards if you cannot show qualifying expenses equal to 15% of gross income. Qualifying deductions include a standard €4,587.09 (or your social security contributions, if higher), staff costs reported to the tax authority and other reported business expenses.

Founders aged up to 35 may also benefit from IRS Jovem on self-employment income, and people moving to Portugal for qualifying research and innovation work can use the IFICI regime’s 20% rate. The overview of taxes for expats living in Portugal explains both.

VAT for new businesses

The standard VAT rate in mainland Portugal is 23%, with reduced rates of 13% and 6%. Madeira and the Azores apply lower rates. Very small businesses may qualify for an exemption, but whether you must charge VAT depends on your turnover, activity and clients.

Rate	Mainland	Madeira	Azores
Standard	23%	22%	16%
Reduced	13%	12%	9%
Super-reduced	6%	4%	4%

Your VAT position is set when you file your start-of-activity declaration, based on your expected turnover and activity codes. Sales of services to business clients in other EU countries and outside the EU follow separate place-of-supply rules, so ask your accountant how to invoice foreign clients before you send the first invoice.

Social security for founders and staff

Self-employed workers pay 21.4% social security on a base calculated from their income. Employers pay 23.75% on employees’ gross pay and deduct 11% from the employee, and must hold occupational accident insurance for staff.

Who	Rate	Base
Self-employed worker	21.4%	One-third of the “relevant income” for each quarter, where relevant income is 70% of service income or 20% of income from sales of goods
Employer, for each employee	23.75%	Gross salary
Employee (deducted from pay)	11%	Gross salary
Company managers and directors	11% individual, 23.75% company	Actual pay, with a minimum monthly base of €537.13
Business client of an economically dependent self-employed worker	10% (80% or more of the worker’s income) or 7% (50% to 80%)	Payable by the client once Social Security issues an assessment

The contribution base is capped at 12 times the Social Support Index (IAS) a month. If one client provides most of a freelancer’s income, that client pays an additional contribution, which is worth knowing if you plan to work through contractors rather than employees.

Set-up and running costs

The official cost of creating a company is low; the recurring costs are accounting, contributions and tax. Budget for advice in the first year, when most mistakes are made.

Cost	Amount	Notes
Company creation through Empresa na Hora	€360	€200 if combined with a trademark in one class, plus €44 per extra class
Beneficial owner declaration (RCBE)	Required within 30 days	Updated whenever ownership changes
Certified accountant	Varies by provider and volume of transactions	Usually a monthly fee; ask what is included
Lease of business premises	Stamp duty of 10% of one month’s rent	Applies to lettings and sub-lettings
Corporate tax	19%, or 15% on the first €50,000 for SMEs	Plus municipal surcharge of up to 1.5% where levied
Employer social security	23.75% of gross pay	Plus occupational accident insurance
Self-employed social security	21.4% of the contribution base	Declared quarterly
Visa and residence fees	Set by the consulate and AIMA	Plus translation and certification of documents

Common mistakes foreign founders make

Most problems come from doing things in the wrong order: trading before the visa, choosing the wrong activity codes, or missing the 30-day beneficial owner deadline.

1. Registering a company before securing a visa. A company gives no right to live in Portugal.
2. Choosing activity codes without advice. They decide your VAT treatment and, under the simplified regime, how much of your income is taxed.
3. Missing the RCBE deadline. The beneficial owner declaration is due within 30 days of incorporation.
4. Forgetting the share capital deposit. If you did not pay it in at the counter, you have five business days.
5. Underestimating staff costs. Add 23.75% employer contributions and accident insurance to every salary, and remember that salaries are paid 14 times a year.
6. Ignoring the 15% expenses rule. Under the simplified regime, failing to report qualifying expenses can increase your taxable income.
7. Assuming UK or US rules apply. Portuguese rules on dividends, director pay and invoicing differ, and double taxation agreements need to be applied correctly.

For English-language job opportunities if you decide to work for an employer while you plan, see jobs for English speakers in Portugal. The complete guide to moving to Portugal covers the wider move, and the Portugal directory lists accountants, lawyers and banks that work with foreign founders.

Frequently asked questions