Company registration in Portugal
It’s safe to say that if you want to open a business in Portugal, you’ll be joining a growing group of driven businesspeople. Portugal has increased its standing among international investors, surpassing even well-known economic giants like France and Germany. This honour demonstrates how welcoming the nation is to business and how successful it might be.
The Portuguese government promotes companies that place a high priority on innovation. Additionally, Portugal has a sizable labour force that is highly skilled. These people have the skills and knowledge required to advance your company and assist you in reaching your objectives.
It is our comprehensive guide to Portugal business setup services. It provides invaluable information, encompassing the necessary steps to register your business. It also navigates the intricacies of the legal obligations you must fulfil. With our guide, you’ll have access to a wealth of knowledge and insights to register a company in Portugal.
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Companies that can be registered in Portugal
The Portuguese business environment includes a wide range of entities. It may be essentially divided into two categories:
- Individual entities;
- Collective entities.
Each category reflects diverse legal frameworks and offers unique benefits and peculiarities for company owners and entrepreneurs.
Individual entities
- Individual Entrepreneur (Empresário em Nome Individual)
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- It is owned by a single individual;
- The firm or commercial name must be constituted by the full or abbreviated civil name of the entrepreneur. It may or may not include an expression alluding to his business;
- There is no mandatory minimum amount for share capital;
- There is no separation between personal assets and business assets;
- The liability is unlimited, meaning the entrepreneur responds to debts contracted in the exercise of the activity with all assets that are part of his estate.
- Individual Limited Liability Establishment (Estabelecimento Individual de Responsabilidade Limitada)
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- Has a single individual as its holder;
- The share capital cannot be less than €5,000, payable in cash, assets, or rights. The cash part cannot be less than €3,333.33;
- It is not recognized as a legal personality;
- There is a separation between the entrepreneur’s assets and those allocated to the company. For debts resulting from economic activity, only the company’s assets are liable;
- The name must contain the name of the holder, in full or abbreviated form, and the expression “Estabelecimento Individual de Responsabilidade Limitada” or “EIRL.”
- Sole Proprietorship by Shares (Sociedade Unipessoal por Quotas)
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- It has a single shareholder who can be a natural or legal person;
- The shareholder owns the entire share capital;
- The partner’s liability is limited to the amount of the share capital;
- The value of the share can vary but never be less than €1.00;
- Only the company’s assets are liable to creditors for company debts;
- The name of the company must contain the expression “Sociedade Unipessoal” or “Unipessoal” followed by “Limitada” or “Lda.”
Collective entities
- Limited Liability Company (Sociedade por Quotas)
- It has two or more partners, who may be natural or legal persons;
- The liability of the partners is limited to the share capital, except in cases provided by law;
- The share capital can be freely fixed by the partners, except in companies regulated by special legislation;
- The value of the share can be variable but never less than €1.00;
- Only the company’s assets are liable to creditors for company debts;
- The name of the company must contain the words “Limitada” or “Lda.”
- Public Limited Company (Sociedade Anónima)
- It has a minimum of five shareholders, who can be natural or legal persons;
- It may be constituted with a single partner provided that this partner is a company;
- The liability of the partners is limited to the value of the shares they subscribe;
- The share capital cannot be less than €50,000 and is divided into shares of equal nominal value;
- Only the company’s assets are liable to creditors for the company’s debts;
- The name of the company must contain the expression “sociedade anónima” or “SA.”
- General Partnership (Sociedade em Nome Coletivo)
- It has a minimum of two partners;
- There is no mandatory minimum amount for share capital;
- The liability of the partners covers the value of their contributions and the assets that make up their estate;
- The partners are subsidiarily liable to the company;
- The name of the company must contain the full or abbreviated names or signatures of all, some, or at least one partner, followed by “e Companhia” or “Cia.”
- Limited Partnership (Sociedade em Comandita)
- It has a minimum of two partners: a general partner and a limited partner;
- There is no mandatory minimum amount for share capital;
- The general partners are subsidiarily liable to the company;
- Limited partners are only responsible for their contribution;
- The name of the company must contain the name or signature of at least one general partner, followed by “em Comandita” or “& Comandita”;
- These are governed by provisions similar to those for general partnerships.
For those looking to register LLC in Portugal, the Limited Liability Company (Sociedade por Quotas) would be the appropriate business structure, as it allows partners to limit their liability to their contribution to the share capital.
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Requirements for the Portugal business incorporation
Due to their flexible management, limited liability, and cost-effectiveness, LLC (LDA) and Sole Proprietorship by Shares are the best business structures in Portugal. Portuguese legal framework requires the following conditions to setting up a company in Portugal:
- The legal form of business
Depending on your firm’s demands, you should select one of the structures outlined in the previous section. However, we recommend our clients choose LDA or Sole Proprietorship by Shares. - Directors and shareholders of the company
The number of shareholders may vary depending on the chosen form of business. - NIF number or fiscal representative Directors of Portuguese businesses need to obtain a NIF number in Portugal. The NIF (Número de Identificação Fiscal) is a unique tax number issued by the Portuguese Tax Authority. However, you may empower a fiscal representative with a permanent domicile in Portugal as an alternative.
- Company name
Choose a distinctive business name that complies with Portuguese legal requirements. The name shouldn’t be in use already or violate any registered trademarks. - Registration address
Find a registered office address where communication and formal papers will be sent. It can be a physical location or a virtual office. - Share capital
Depending on the legal form you choose, determine the minimum share capital needed. The nature of the business also influences the required equity capital. - Corporate bank account
Create a corporate bank account with a Portuguese financial institution and deposit the necessary share capital. - Accounting and bookkeeping
Ensure your company complies with Portuguese accounting laws and regulations. Hiring a professional accountant is the best way to meet these requirements. - Other requirements
Depending on the nature of your business, additional steps may be required, such as obtaining a VAT number, registering a trademark, or securing necessary licenses.
Documents required for company formation in Portugal
The list of documents may vary in each case, but the basic documentation typically includes:
- Identification documents
Shareholders, directors, and the company secretary (if any) must provide a passport or equivalent ID, such as a residence permit. - NIF number
Shareholders, partners, managers, and directors of the company are required to obtain a NIF. In the case of a single-person LDA (Unipessoal), you may appoint a fiscal representative residing in Portugal. - Proof of address
Each shareholder and director must provide proof of address, such as a utility bill, in English or Portuguese. - Articles of Association
This document should outline the goals, operations, and internal rules of the business. - Power of Attorney
If you authorize someone other than a director or shareholder to apply to the registry, a Power of Attorney is required. - Licenses and permits
If your company operates in a regulated industry, you may need to obtain specific licenses or permits for certain activities.
Benefits of registering a company in Portugal
Every company owner and entrepreneur must weigh the pros and cons of expanding their business in a particular jurisdiction. The good news is that starting a company in Portugal offers far more advantages than disadvantages.
Excellent Geographical Location
Portugal is an ideal location for businesses due to its position in the southwestern region of Europe. Local firms enjoy easy trade connections to Africa, South America, and Europe.
Access to the EU Market
As an EU member, company registration in Portugal grants access to the single market. This offers freedom of movement for people and goods, as well as the potential for economic growth within the EU.
Skilled Workforce
Portugal boasts a literacy rate of 96%, with an estimated 44% of residents aged 30 to 34 having completed college or university. This indicates a large, educated labor force capable of filling essential staffing roles.
Straightforward Company Incorporation
The process to form a company in Portugal has become more streamlined and efficient. Setting up a Limited Liability Company (LDA) can take just a few days, either online or in person. The ease of registration makes Portugal an appealing destination for entrepreneurs.
High Quality of Life
Portugal offers a high standard of living at a lower cost compared to many other European countries. Its well-established healthcare system, both public and private, contributes to an 81-year average life expectancy and a low crime rate.
Business-Friendly Jurisdiction
To encourage entrepreneurship, the Portuguese government has introduced measures like favorable taxation, streamlined administrative procedures, and funding schemes that make it easier to incorporate a company in Portugal.
Increasing Economy
Historically reliant on industries such as textiles, tourism, and agriculture, Portugal’s economy has recently begun diversifying. The country’s vibrant startup culture has created opportunities for entrepreneurs to test their business ideas, making it an excellent environment for startups.
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Our assistance in registering a company in Portugal
Fintech Harbor Consulting provides complete guidance and legal support for those seeking legal entity registration Portugal. We aim to assist entrepreneurs and small company owners. With our support, you can be confident in a smooth incorporation process and ongoing regulatory compliance. As a reliable company formation agent in Portugal, our team will help you with the following:
- Turnkey incorporation procedure
We assist our clients in selecting the best legal structure for their company formation in Portugal. Our main criteria include legal responsibility, governance, and taxation. We offer expert advice in drafting and reviewing legal documents, and we ensure all necessary paperwork is submitted to meet Portuguese legal requirements. Additionally, we can help you obtain a local NIF or recommend a reliable fiscal representative. Contact us, and we’ll provide a cost estimate for opening a company in Portugal. - Regulatory compliance
Navigating complex regulatory frameworks is a common challenge for newly established companies. Fintech Harbor Consulting can guide you through requirements such as licensing, data protection, anti-money laundering (AML), and know-your-customer (KYC) regulations. - Marketing plan
Our team can develop a comprehensive market entry strategy for your business. We consider various factors, including target customer segments, competitive analysis, and marketing and distribution methods. We offer full-scope market research and analysis. - Ongoing Assistance
Beyond incorporation, we provide continuous support, including accounting, bookkeeping, tax compliance, and staying updated on regulatory changes. Additionally, we offer strategic advice for expanding and growing your business in Portugal.
How to start a company in Portugal
- Portugal company setup cost
Portugal as a jurisdiction for company setup may offer quite a streamlined process for establishing a business, making it a really attractive option for entrepreneurs. The country provides a stable economic environment, supportive legal framework, and access to the European market. The process of setting up an entity is straightforward as the business environment is supportive and suitable for offered legal structures. Additionally, it’s completely possible to open and run the business fully remotely handling all the necessary processes with the help of our professional team of experts. - Portugal company incorporation cost
The incorporation costs of the Portuguese company often vary depending on the chosen legal structure and some specific services that may be required on the stages of incorporation. Basic ongoing expenses of incorporation process usually include registration fees, notary and legal consultation fees and costs for opening a bank account. Additionally, the final price for the whole process may depend on the legal advisors you choose. Feel free to contact our sales team to get an accurate calculation of company incorporation costs in Portugal.
How to start a company in Portugal
Selection of company structure
It is critical to choose the best business structure when you start a business in Portugal, which depends on various factors. Common options in Portugal include partnerships, limited liability companies (LDA), and joint-stock companies (SA). Each structure has its own set of benefits and drawbacks.Establishing the registered address of the company
You must set up a registered office for your business in Portugal. All legal correspondence and official documents will be directed to this address. It will also be listed in the Portuguese business registry and other official databases.Obtaining Portuguese tax number (NIF)
Key company stakeholders, such as shareholders and directors, must obtain a Portuguese tax identification number (NIF) to conduct business in Portugal. The Portuguese Tax Authority issues this number upon receiving the necessary documents and completing the registration process. Alternatively, you may hire a fiscal representative to assist with this step.
- Transferring Power of Attorney
If you wish to register your business remotely, you can use a Power of Attorney to designate someone to act on your behalf. This legal document grants the individual the authority to perform specific actions, such as signing documents, opening bank accounts, and submitting applications. - Company name registration
Choosing a distinctive and compliant name for your business is crucial. The name must follow Portuguese naming regulations and must not infringe on any registered trademarks. Ensure the desired name is available before proceeding with registration. - Drafting corporate documents
Corporate documents, including the Articles of Association and Memorandum of Association, must be prepared. These outline the company’s goals, operations, share capital, internal rules, governance structure, and other important details. Seeking legal advice is recommended to ensure compliance with Portuguese laws. - Applying to the registry
Once the corporate documents are prepared, they must be submitted to the relevant governmental authorities. This process can be completed remotely. - Bank account opening
To conduct business in Portugal, you must open a bank account with a Portuguese financial institution. The necessary share capital should be deposited into this account. - Accounting and bookkeeping
To comply with Portuguese regulations, it is essential to establish proper accounting practices for your business. - Performing other necessary steps
Depending on the nature of your business, additional steps may be required for registration in Portugal. These could include obtaining specific licenses or permits, securing a VAT number, or other requirements. Thorough research and understanding of the relevant standards are vital for full compliance.
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FAQ
Who can open companies in Portugal?
Any person or organization may register a company in Portugal. It includes Portuguese residents, foreigners, and foreign corporations. However, depending on the kind of corporation and commercial activity, particular rules and laws may apply. To guarantee adherence to the required processes and specifications, contact Fintech Harbor.
How can I open an LDA in Portugal?
There are two ways to establish an LDA (Limited Liability Company) in Portugal: in person or remotely with the use of a Power of Attorney. Contact Fintech Harbor Consulting, and we will provide fast and smooth company registration in Portugal.
What is an EIRL in Portugal?
Empresa Individual de Responsabilidade Limitada (EIRL) is an Individual Limited Liability Establishment. EIRL allows anyone to run a business as a sole proprietor with limited liability. However, it is not so favourable type of individual entity due to its high minimum share capital requirements which is EUR 5,000. We recommend our clients register a Sociedade Unipessoal por Quotas (single-member LLC) instead.
Opening a company in Portugal cost
The price of company formation in Portugal might vary based on several variables. It includes the legal structure you choose, the services you need, and other expenses. Contact us and we will calculate how much the opening of a company in Portugal costs.
How to open a company in Portugal for non-residents?
Company formation in Portugal for non-residents looks the same as for residents. The only exception is that the director will need a Portuguese tax residence. In this regard, he can apply for a local tax identification number (NIF) or appoint a fiscal representative.
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