All You Need to Know on How to Start a Business in Portugal

8 min readDec 9, 2020

No matter what expansion strategy you put into place, BRIDGE IN can help you register a company in Portugal, or simply hire skilled talent through its Employer of Record services.

Setting up a business in Portugal means you will have a strategic geographical position: while allowing you to enter the European single market, Portugal is also the natural gateway between EU and other major world markets in North and South America. For historical reasons, Portugal also holds strong ties with the largest African markets as well as with many Asian countries.

Companies such as Cloudflare, Salsify, Uber and Dashlane have built tech, sales, and customer success teams in Portugal; top-notch technology and infrastructures, a business-friendly environment and a cost-competitive & highly skilled workforce are some of the reasons why successful startups and scale-ups worldwide have chosen Portugal as one of their outposts.

There are at least two ways in which you can start doing business in Portugal and therefore in Europe. It all depends on your risk profile, size of the operation, and whether you are ready to set up a legal entity:

  1. EMPLOYER OF RECORD SERVICES — if you are not ready to take the leap, there is an easier and less risky solution that will allow you to avoid major up-front investments and a raft of foreign compliance requirements. With us as an EOR provider, you can start hiring and having operations in Portugal by employing your team under BRIDGE IN: you keep ownership of the workforce while we take care of taxes, payrolls and all HR-related tasks under our own local legal entity.
  2. SOFT-LANDING IN PORTUGAL — many are the requirements you need to meet prior to establishing your legal entity in Portugal. Although English is widely spoken, much of the official correspondence and official documents you will be dealing with will be in Portuguese. By acting as your interim country manager, BRIDGE IN can help you streamline the whole process: working with us as your local experts will greatly speed up your market entry, cut your learning curve & culture adaptation, help you identify and offset risks, avoid mishaps and maximize your ROI.
How to efficiently start a business in Portugal
Test the market by hiring talent through an EOR, and incorporate your company and your team later.

Work with an Employer of Record in Portugal: Reach Your Growth Goals Faster While Keeping Costs Down

When you are entering regions and territories where you have no experience operating and in-depth knowledge of the regulatory framework, miscalculating timelines, and underestimating potential costs are common mistakes. A general rule of thumb is that no matter where you are looking to gain an international presence, everything will take more time and be more expensive than you think.

Many organizations choose to avoid or postpone investment in entity setup until they have justified the timeline, expense and corporate tax structure it entails. They use BRIDGE IN as a solution to hire employees and “test the waters” in new markets, so that when the business grows and the cost of an entity can be justified, employees can be seamlessly transferred to the new local subsidiary. Other organizations, wary of the tax presence and large financial investment required to set up an entity, rely on BRIDGE IN exclusively for fulfilling their employment needs in Portugal.

BRIDGE IN, your Employer of Record in Portugal

In a nutshell, the advantage of working with an EOR in your expansion strategy is that you have full control over the selection, onboarding, compensation and working relationship with the employees you hired through BRIDGE IN, while we take all the bureaucracy and legal compliance off your shoulders. Furthermore, the initial time & money investment needed to launch operations through an EOR is significantly lower compared to the one needed to establish a legal entity.

To get all necessary information on time, costs & processes of incorporating your company in Portugal VS using an Employer of Record, download our full guide.

Setting Up a Company in Portugal

Portugal is ranked 39 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings, scoring significantly better than larger economies such as Spain, Italy and Germany. It is indeed relatively easy to set up a business in Portugal; however, the process involves a great deal of time, local regulations knowledge and paperwork.

Ease of doing business in Portugal
Source: World Bank — the ranking of economies on the ease of starting a business goes from 0 to 100, where 0 is not easy at all and 100 is the best-ranking position.


EU/EFTA National:

If you are an EU/EEA/Switzerland citizen that wants to remain in Portugal for a period exceeding 3 months, you need to apply for a Registration Certificate. This document ensures your right of residence in Portugal, costs around 15€ and is provided by the Local Council of your place of residence.

Non-EU/EFTA National:

If this is your case you will need to obtain a Portuguese Work Visa and Residence Permit. For entrepreneurs, investors and highly qualified individuals, there are special programs. The Startup Visa, which helps foreign entrepreneurs obtain a visa and residence permit but also to find a certified incubator to support their project. The Tech Visa, which is geared to highly skilled/qualified workers in the areas of technology and innovation. For those wishing to invest in Portugal, they can also possibly be eligible for the Golden Visa (no longer available in Lisbon and Porto beyond December 2020).

Complete information on how to register as non-Portuguese citizen is available on SEF website (Official Portuguese Immigration Authority).

In both cases, you will then need to request a Tax Identification Number (NIF) to the Portuguese Tax Office followed by a Social Security Identification Number (NISS).


Creating a company in Portugal means you are either building an independent business, or you are expanding your company to this new location.

In the first case, you are opening a Portuguese company. Otherwise, you are opening a new office for a business that already exists in another country. Being this the case, you need to understand whether you want to register a subsidiary of your mother company or a branch office. The differences between these two legal forms lay mainly in taxes and liability.

Before registering a company it is necessary to agree on:

  • The shareholders of the company;
  • The managing directors of the company;
  • The social object of the company;
  • The articles of association that will be applicable to the new company (you can either draft the articles or use a local pre-approved template).

Once you gathered the above information, these are the steps you need to take:

  1. Choose a name: you can pick one from a list of pre-approved names or choose one outside of the list and request a name approval certificate before registering the company. A standard request takes up to 10 business days to get an answer and it costs 75€. For urgent requests (answer in 1 business day) the cost is 150€.
  2. Company office address: You will need to register a business address in Portugal. You can find many coworking spaces in Lisbon and elsewhere in the country that will allow you to use their address as your business address.
  3. Get a certified accountant: when registering your company, you will have to prove that you have a certified accountant (“TOC”) or you can also choose one from a list made available at the registration desk. Also, if you decide to create a Public Limited Company, you need to have an auditor — Revisor Oficial de Contas (ROC) — as well.
  4. Get a lawyer: Although not absolutely mandatory, getting a law firm involved can be a good idea, especially if you have a complex legal structure or require custom Articles of Association. Talk to us to know who the best lawyer for you is.
  5. Decide on company legal structure:
  • Private Limited Company (“Sociedade por Quotas”)
  • Individual Stakeholder Company (“Sociedade Unipessoal por Quotas”)
  • Public Limited Company (“Sociedade anónima”)
  • Others (additional information here)


There are three possible ways to register your company in Portugal:

  • Setting up online takes less than an hour and the registration fee depends on the Articles of Association chosen: approximately 220€ for pre-approved articles and 360€ for articles established by founders. If you choose to register your company online, you and all the shareholders of the company to be established must hold a Portuguese Citizen Card with an activated digital signature or a Digital Mobile Key. Otherwise, we can help you to choose a registered lawyer, notary or solicitor that holds a digital certificate and can register the company on your behalf.
  • Setting up on the spot (service called “Empresa na hora”) allows you to register your business in person. All shareholders of the future company have to go to the Empresa na Hora desk to start the incorporation process. If any shareholder cannot attend, they may be represented by another person who shall have power of attorney. For a standard registration, this service costs around 360€. If the company’s share capital includes assets that are not money, this registration cost may vary. Also, when setting up on the spot, the Articles of Association must follow pre-approved templates.
  • Setting up through the traditional way implies going through several steps with different entities, at different times. You need to apply for the Certificate of Name approval, deposit the company’s share capital, prepare the memorandum and articles of association, submit the declaration of beginning of activity, register your business at the Commercial Registry Office, and register at the Social Security.


Congrats, your operations are almost up and running! What you need now is to set up a company’s bank account, submit the declaration of beginning of activity to the Portuguese Tax Office, register your company and its initial employees at the Social Security, register the Beneficial Owner, get an invoicing software and get labor insurance cover for your employees.

Tax-wise, to run a business in Portugal you will have to pay a Corporate Income Tax — Companies pay a flat rate of 21% on taxable income. SMEs pay a reduced tax of 17% on the first €25k of taxable income. In Azores and Madeira IRC rates are lower.

Corporate Income Tax in Portugal compared to other countries
Source: Trading Economics

Portuguese Corporate Tax is quite reasonable when comparing with other Western Countries.

For complete information on all the steps you need to take to create a legal entity in Portugal, what are the government grants & incentives, as well as information on taxes, download our guide or schedule a call with us.

Originally published at on December 9, 2020.




BRIDGE IN helps companies set-up their tech hub and hire talent in Portugal. We are the OS for distributed teams.