How to Start a Business in Portugal

Useful Information

Starting a Business in Portugal

How to Start a Business in Portugal

Working in Portugal

Employment in Portugal

Helpful Information & Links in Portugal

Code of Work Practises in Portugal

(Codigo de Trabalho)

(Centro de Emprego)

If you are determined to start a company or business in Portugal it is best you know the procedure involved. Unfortunately you cannot simply get business cards printed and begin trading the next day.

Well you can but you run the risk of hefty fines from the tax office should you decide to do this. In Portugal if you want to run a business or company you will need to ensure you have all the correct paperwork signed, sealed and in triplicate.

The Portuguese government will and can tax income earned illegally by so-called businesses and impose heavy fines on the perpetrators so it's best to know the law and try and operate within it, even if you have a rudimentary command of the language.

One of the biggest reasons companies fail in Portugal is inadequate market research prior to the creation of a company. If you are looking to start a business in Portugal it is imperative you carry out good market research to determine there is demand for your business.

Good market research is necessary to ascertain potential customers/consumers, demand for product or service as well as information on the current market leaders and whether the market is strong enough not only to support your business but that there is a need.

Creating a business plan for your proposed company or business in Portugal is not a legal requirement, however it will help you examine the viability of your business. when creating a business plan be realistic with your projected income and all of the costs associated with running the business. By creating a business plan you could very well save yourself thousands of Euros without even starting a company.

One of the most important issues you will have to decide when you have taken the decision to start a business in Portugal is the structure of  the company and how it will be set up. There are various structures for businesses in Portugal, depending upon the size, nature of the company and estimated turnover. In Portugal these structures take into account the estimated turnover, company employment level and number of founding partners within the company.

Once you have decided the structure your company will  be formed as, then you will need to visit the relevant governing bodies to register your company name, set up the deeds of incorporation and furnish your company with a Fiscal Number along with all the other necessary legal requirements.

This was once a long and drawn out process in Portugal requiring appointments at various government offices. However in January 2006 to help simplify the creation of new businesses in Portugal, the Portuguese government introduced 'one stop shops' called Empresa Na Hora (Company in an Hour).

Empresa Na Hora's can be found at Centro de Formalidades das Empresas (CFES) and at some conservatória's (land registry offices) in towns of adequate size.

Once you have assessed your market research and business plan and have decided to proceed with starting a company in Portugal you will have to choose a name which is appropriate to the kind of business you will be running.

If you wish to get your company up and running as quickly as possible you can chose to utilise one of the pre-approved names provided by Empresa Na Hora. By choosing a pre-approved name you can have your company incorporated within an hour. This list is ever changing and can be viewed online  at http://www.empresanahora.pt/ENH/sections/EN_list-names.

If you already have the name of your company in mind though, you will have to set the company up in the longer, traditional fashion, waiting approximately 23 days for the deeds of incorporation to be created. You will also have to check your proposed name against the national registry of companies (Registo Nacional de Pessoas Colectivas) to ensure it, or one similar, is not already being used.

Once you have decided on a name for your company and the structure you will be formulating it as, then it's time to visit either the Centro de Formalidades das Empresas or a branch of Empresa Na Hora to start the process.

When visiting either of these you will need to remember to take all of your identity papers (identity cards/ passport) as well as your personal tax numbers. The steps involved in the creation of a company in Portugal are as follows whether you carry this out at a Centro de Formalidades das Empresas or Empresa Na Hora. *steps below based on utilising a pre-approved company name.

Step 1. Provisional Registration of the Company Name

Step 2. Signing of Public Deed of Incorporation

Step 3. Declaration of Start of Activity for Tax Purposes

Once the deed of incorporation has been signed you will need to declare the official start date of the company for tax purposes. This needs to be within 90 days of the Company Identity Card being issued.

Step 4. Registration of the Company at the Commercial Registry

Once all the above has been carried out, the company will be registered with the Registo Nacional de Pessoas Colectivas to ensure no other company can register the name.

Step 4. Registration at the Regional Social Security Office

The final step in registering the company is validating it with the tax office in order to pay social security contributions for directors, managers and staff.

Following the creation of your company in Portugal it is essential to manage your company wisely, utilise innovative marketing strategies and always keep an eye on the competition to ensure your company does not become another statistic. Running a business in Portugal as a foreigner is always going to be a little harder, however it can also be extremely rewarding, not only financially.