The key to success for any business owner is finding the right product to sell. You must understand your products and those of your competitors. You also need to invest in the right tools and licenses.The bright and exciting area of portugal makes it One of the most sought-after destinations for business entrepreneurs. Thanks to its vast potential for growth, many people are deciding to switch to selling merchandise online. So how do you open a business in Portugal?
What options are available to you if you want to open a business in Portugal?
Let’s examine the different options available to you. Firtly, you can register as a freelancer which is like operating as a sole trader in the UK. The second option is to open a company in Portugal.
Understanding Portuguese Tax laws
If you want to start your own business in Portugal, you need to understand the laws surrounding company formation in the country.You will also need to become familiar with the Portuguese tax system and VAT requirements before you begin your business plan. If you want to avoid legal problems, it is important to hire a skilled tax advisor to help you set up your business in Portugal and ensure that you adhere to the correct rules and regulations. It is also important to note that you are required to open a company bank account in the country and comply with banking laws.
Becoming a Freelancer
Anyone who is a Portuguese resident can register as a freelancer in Portugal. When you register as a freelancer you will be able to issue recibos verdes (green receipts). This informs the IRS and social security that the self employment exists. You can register online by requesting an access code (in advance) by creating a new account in the Portal das Finanças. The code is sent to your residential address in Portugal and takes a few business days to arrive. Once you have received the code by post you need to login and activate it. Then you can register for Recibos Verdes and issue them online.
Opening a Company in Portugal
Portugal offers a diverse range of options for foreign investors who wish to establish a business in the country. The country’s Portuguese Business Code (Business Opportunities Act – BOPLA), stipulates that foreigners must have at least a 25 percent stake in their business or enterprise, although certain exceptions may apply. In most cases, if a foreigner wants to establish a new business in Portugal, they may do so through a Limited Liability Company (Sociedade Anónima) or a Limited Partnership (Sociedad de Convivencia). While both types of company have similar characteristics, the latter allows investors to reduce the required capital requirements.
Paying income tax World Wider
Businesses established in Portugal are required to pay income tax on their worldwide income and capital gains tax on profits made from selling shares of their companies. However, there are various exemptions and deductions available that a business can claim for income tax purposes. These range from capital allowances to investment incentives.
Renting an Office
To operate a business in Portugal, you will need to rent an office space and hire employees. However, the rent of office space is relatively cheap and you can find many options in various areas of Portugal. Portugal has a low unemployment rate and the unemployment rate remains steady at around 8 percent, which means that finding the right employees should not be a problem for you.
Get an Agent, Attorney and Accountant
If you’re seriously considering opening your business in Portugal, it is recommended you get in touch with a reputable company formation agent who can help you register your company and ensure compliance with all rules and regulations. You can also hire an attorney to help you draft company bylaws and advise you on the legal procedures of opening a business in Portugal.
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