Business

Legal Framework for Business in Portugal

Portugal maintains an open economy that encourages foreign investment. According to the 2025-2026 administrative guidelines, foreign nationals possess the same rights and obligations as Portuguese citizens regarding the creation and management of commercial entities. There are no general restrictions on the percentage of capital held by non-residents, although specific regulated sectors (such as defense or maritime activities) may have distinct requirements.

To initiate any business activity, a foreign national must first obtain a Número de Identificação Fiscal (NIF), which is the Portuguese tax identification number. For non-EU/EEA residents, the appointment of a local fiscal representative was traditionally mandatory; however, as of recent updates, this is primarily required if the individual does not opt for digital notifications through the Canais de Atendimento das Finanças.

Useful resource: ePortugal - Business Portal

lisbon business district — Lisbon Business District

Types of Business Entities

Investors must choose between operating as an individual or establishing a collective entity. The choice impacts liability, taxation, and accounting requirements.

Individual Entrepreneurship

Empresário em Nome Individual (ENI): The simplest form where there is no legal distinction between the owner's personal assets and the business's assets.
Estabelecimento Individual de Responsabilidade Limitada (EIRL): Allows the owner to separate a portion of their assets to be liable only for business debts.

Collective Entities (Companies)

Sociedade Unipessoal por Quotas: A limited liability company with a single shareholder. The minimum share capital can be as low as 1 EUR ($1.08 USD, Jan 2026) per share.
Sociedade por Quotas (Lda): The most common form for small and medium businesses. It requires at least two partners. Liability is limited to the company's assets.
Sociedade Anónima (SA): A corporation suited for larger investments. It requires at least five shareholders and a minimum share capital of 50,000 EUR ($54,000 USD, Jan 2026).

modern office workspace — Modern Office Workspace

The Registration Process and Costs

Portugal has streamlined the incorporation process through the Empresa na Hora (On-the-Spot Firm) initiative. This allows entrepreneurs to set up a company in a single visit to a dedicated registry office.

Steps to Incorporate

Choose a Name: Select from a pre-approved list of names or provide a Certificado de Admissibilidade issued by the RNPC (Registo Nacional de Pessoas Coletivas).
Appoint a Statutory Auditor: Mandatory only for specific types of companies (SA).
Deposit Share Capital: The capital must be deposited into a bank account in the company's name or declared to be paid into the company's coffers within five days.
Submit Documents: Identification of partners, NIFs, and the company's articles of association.

Standard Fees

The standard cost for the "Empresa na Hora" service is 360 EUR ($388 USD, Jan 2026). This fee includes the commercial registration and the publication of the memorandum of association. If the company includes immovable property as part of the share capital, additional fees apply for land registration and taxes.

Official registration portal: Justice Ministry - Empresa na Hora

business contract documents — Business Contract Documents

Once registered, the business must be activated for tax purposes with the Autoridade Tributária e Aduaneira (AT) and registered with the Social Security office.

Corporate Taxation

The standard Corporate Income Tax (IRC) rate in mainland Portugal is 21%. Small and Medium Enterprises (SMEs) benefit from a reduced rate of 17% on the first 50,000 EUR ($54,000 USD, Jan 2026) of taxable profit. Municipal surtaxes (Derrama) may apply, varying by municipality up to 1.5%.

For salaried employees, the standard Social Security rate is 34.75% of the gross salary, where 23.75% is paid by the employer and 11% is deducted from the employee. For self-employed individuals (ENIs), the contribution rate is generally 21.4% of the relevant income.

Note: Non-habitual resident (NHR 2.0 / IFIC) schemes or specific regional incentives in Madeira and the Azores may offer significantly lower tax rates for qualifying international business activities.

Tax authority website: Portal das Finanças