A favorable company registration in Portugal in 2021

A favorable company registration in Portugal in 2021

Having a rapidly growing economy, Portugal attracts increasingly large amounts of FDI every year. The Portuguese government keeps coming up with new incentives for foreign investors, making the country an even more attractive jurisdiction for doing business.

Those seeking to establish a company in Portugal can do it in 2 ways:

  • Public Limited Company (SA);
  • LLC (SpQ/Lda).

Requirement for registering an Lda in Portugal are as follows:

  • minimum share capital - 1 Euro (to be paid until the end of the tax year);
  • minimum share capital for an enterprise with 1 shareholder - 1 €; with 2 shareholders - 2 €;
  • opening an account with a Portuguese bank remotely;.
  • making Social Security payment immediately after registration.
  • having an email account for receiving tax-related documentation.

Features of Lda:

  • 1 director (a foreigner or a resident of Portugal);
  • 1 shareholder (an individual or legal entity: can be a director);
  • company registers are not publicly available;
  • max. number of shareholders is unlimited; residency does not matter;

Features of Portuguese SA:

  • minimum authorized capital - 50,000 euros;
  • minimum number of shareholders - 5;
  • strict accounting/auditing requirements.

To register an LLC in Portugal, you need:

  • a unique name;
  • IDs of directors/shareholders;
  • confirmation of a legal address (having a registered office is mandatory)

Advantages of opening an Lda in Portugal:

  • those considering registering a Portuguese Lda, must notarize their company’s charter and open an account with a bank in Portugal;
  • non-residents (legal entities or individuals)can register an enterprise in Portugal;
  • you can register a Portuguese company with 1 person (can be simultaneously a director and a shareholder);
  • MOA describes specific actions or gives a broad description allowing you to conduct versatile business;
  • it is possible to hold meetings of shareholders anywhere (providing the Charter allows that);
  • Lda members have quotas described in the Charter;
  • Lda requires 2 members; it is allowed to combine Lda with one quota holder.

Taxation

IRC - Portuguese corporate tax standard

21%

A corporate tax

17%

Companies in the Azores

16,8%

Companies in Madeira free trade area

5%

A state fee is levied on residents and non-residents with a permanent establishment

3% of profits - from 1,5 to 7,5 million euros; 5% of profits - from 7,5 to 35 million euros; 7% of profits - up to 35 million euros

A municipal fee is levied on residents and non-residents with a permanent establishment

Depending on a municipality, it can be up to 1,5%

Taxes for foreign enterprises are the same; however, only income earned in Portugal is taxed. Investment income is taxed at a rate of 35%.

Considering registering a Portuguese enterprise? Need advice on registering a company in Portugal? Why not contact YB Case?

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