If you plan to register a startup in one of the most prestigious jurisdictions of the European Union, then opening a company in Portugal will be the best option.
We will describe in detail in our article how and where it is best to open an account in Madeira, as well as how to do business in the autonomous region of Portugal.
Madeira is one of the 2 autonomous regions of Portugal. An island jurisdiction covers the territory of the eponymous archipelago, located in the North Atlantic Ocean. The archipelago includes 2 large inhabited islands (Madeira, Porto Santo), a group of Selvaženš islands and the deserted islands of Ilhas Desertas.
Madeira serves as an important financial, commercial and tourist center of Portugal, which is one of the key reasons for the constant increase in the number of people, wishing to register a company in Madeira and to open an account with a Portuguese bank.
The information about this jurisdiction
The nearest neighbors are: Portugal, Africa. Leading sectors of the economy of the autonomous region are: an industry, a fishing, a viticulture, a real estate, banking and insurance, a tourism. The administrative center is Funchal. A state language is Portuguese. The state currency is the euro (EUR).
A participation in international organizations (as a part of Portugal): IBRD, OSCE, European Union, OECD.
Benefits of starting a business in Madeira
Results of studies by Doing Business financial magazine showed, that in 2019 Portugal entered the top 35 countries in terms of ease of doing business, and, also, took 32nd place in terms of connecting to the power supply system, 16th place in resolving insolvency, as well as 1st place for international trade.
In addition, those, who wish to set up a company in Madeira remotely, expect the following favorable conditions for doing business in this jurisdiction:
- High rates of economic growth;
- A sustainable socio-political situation;
- A developed transport infrastructure;
- A low crime rate;
- Reasonable prices for real estate, as well as goods and services;
- The positive attitude of authorities towards foreign investment;
- A modern banking sector;
- The ability to hire skilled labor;
- A relatively short period for obtaining a business visa (from 5 to 21 days);
- A visa-free regime in the Schengen zone;
- A loyal tax system;
- Favorable conditions for the development of small and medium-sized businesses;
- The fast and easy incorporation process.
If you want to establish a commercial enterprise in Madeira and open an account with a bank of Portugal, we advise you to choose one of the following business areas: a hotel business, a transport, a restaurant business, IT technology, services, a light industry, pharmaceuticals, a food industry, a winemaking.
The registration of a Portuguese company will be beneficial for the following reasons:
- Portugal ranks 5th in Europe in terms of simplicity of incorporating a business;
- The presence of a special industrial zone in Madeira creates the most comfortable conditions for entrepreneurship;
- The cost of renting an office is one of the lowest in Western Europe;
- A well-established logistics network (2nd place in Europe).
Basic legal forms of enterprises in Madeira
Those, who are going to register a company in Madeira remotely and to open a corporate account in Portugal, will have the access to the following forms of business activity:
- Limited Liability Company (Tax-Resident LLC);
- Local Limited Company (Madeira LLC);
- A company with 100% foreign capital/a company in a special industrial zone (Madeira IBC/Santa Maria FTZ);
- Joint Stock Company (PLC/SA);
- A company with limited liability and Golden Visa LLC (Golden Visa LLC);
- A Representative Office (ER).
The following forms of business activity will be available for foreign businessmen, interested in opening a company in Portugal:
- Joint Stock Company (PLC/SA);
- A company with 100% foreign capital/a company in a special industrial zone (Madeira IBC / Santa Maria FTZ).
Opening a corporate account in Madeira
Our specialists have prepared a list of the most reliable banking structures. We recommend you to open an account with Novo Banco, to register a corporate account with Banco BPI, to open an account with a company at Millennium BCP, as well as a number of financial institutions such as:
- Banco BNI Europe;
- Banco Atlantico Europa;
- Banco Santander.
Business registration terms
In order to register a company in Madeira remotely, you will need to study carefully the list of requirements of the local regulatory authority:
- A selection of a unique name of the enterprise (at the end indicate the selected legal form);
- At least 1 director;
- At least 1 shareholder;
- A minimum authorized capital is from 11,750 EUR;
- A resident status is not required;
- A secretary is not required;
- Your business can be managed by both private and corporate individuals;
- Opening an account with a Portuguese bank is required;
- Obtaining a license to conduct business in Madeira is required;
- A registered office and the address are not required;
- A reporting (a financial) is required;
- The company audit is required.
A tax system
Those, who are interested in such an opportunity as registering a company in Madeira, will need to familiarize themselves with terms of taxation of jurisdiction in detail.
Madeira, as an autonomous region of Portugal, obliges registered companies to pay an income tax at a favorable rate of 20% (a corporate tax in the rest of Portugal - 21%). This is much lower, than in neighboring Spain (25%) and Morocco (31%).
Also, the country provides for a reduced tax rate of 13% on first income of 15 thousand EUR for small and medium-sized businesses, whose annual income is less than 50 thousand EUR.
Local LLC, as well as enterprises of the free industrial zone, pay an income tax at a rate of 5%. Other taxes:
- a dividend tax is 25%;
- a tax on interest and royalties is from 0 to 25%;
- a VAT: 22-23%.
Professional assistance in starting a business in Madeira
If you want to open a Portuguese company, then YB Case specialists are ready to help you to solve this problem in a convenient remote mode. We will provide you with a full range of professional services, including: preparing a business plan for the autonomous region and the country as a whole, opening an account with a Bank of Portugal, obtaining permits for doing business in Madeira, preparing all necessary documents and more.
A duration of the company registration in Madeira is up to 2 weeks.