Can a foreigner open a company in Portugal without living there?

Yes. Non-residents can incorporate a Portuguese company (Lda or Unipessoal Lda) without being resident. You will need a Portuguese tax number (NIF) for each shareholder, and non-EU residents must appoint a fiscal representative. The whole process can be completed remotely with power of attorney.

How much does accounting cost for a small foreign-owned company?

Monthly accounting for a small foreign-owned company in Portugal typically costs between EUR 150 and EUR 350 per month, depending on document volume, employees, and VAT regime. HVR's entry package starts at EUR 150/month and includes corporate tax (IRC), VAT (IVA), and Modelo 22 annual return.

What is a fiscal representative and is it mandatory?

A fiscal representative is a Portugal-resident person or entity who represents you before the Portuguese tax authorities. It is mandatory for non-EU/EEA residents. EU/EEA residents are not required to appoint one but may opt to do so. The representative receives tax communications and is jointly liable for filings.

What is the corporate tax rate (IRC) in Portugal in 2026?

The standard IRC rate is 20% on the first EUR 50,000 of taxable profit for SMEs (under the simplified regime), and 21% for larger companies. A municipal surcharge (derrama municipal) of up to 1.5% applies, plus a state surcharge for profits above EUR 1.5M. Madeira Free Trade Zone offers reduced rates of 5% under specific conditions.

Do foreign-owned Portuguese companies need to file in English?

No. All filings to the Portuguese tax authority (Autoridade Tributária) and the central business registry must be in Portuguese. However, working with a bilingual accountant means your management reports, board minutes, and tax explanations can be in English. HVR delivers all client-facing communication in English on request.

Can I pay myself dividends from my Portuguese company as a non-resident?

Yes. Dividends paid to non-resident shareholders are subject to a 28% withholding tax in Portugal (35% for low-tax jurisdictions). Most double tax treaties reduce this to 5% or 15%. Always consult your accountant before distributing — proper documentation is required to claim treaty benefits.

What is the VAT (IVA) registration threshold for a Portuguese company?

Companies with turnover above EUR 15,000 (small enterprise threshold for 2026) must register and charge VAT. The standard VAT rate in mainland Portugal is 23%, the intermediate rate is 13%, and the reduced rate is 6%. Madeira and Azores have reduced regional rates.

Does HVR work with companies whose owners do not speak Portuguese?

Yes. HVR has a bilingual team and serves foreign-owned Portuguese companies, expat founders, and international groups with subsidiaries in Portugal. Communication, contracts, monthly reports, and explanations can all be in English.

Accounting for Foreign-Owned Companies in Portugal 2026

Accounting for Foreign-Owned Companies in Portugal — 2026 Guide

A foreign-owned company in Portugal — meaning a Portuguese company (typically a Lda or Unipessoal Lda) where the shareholders are non-Portuguese — has identical tax obligations to a Portuguese-owned company. Total monthly accounting cost typically starts at €150 and scales with document volume and employees. Non-EU shareholders must appoint a fiscal representative; EU shareholders are exempt. Below: structures, taxes, costs, and the full first-year roadmap.

Who this guide is for

This pillar guide covers every situation where a non-Portuguese individual or entity owns part or all of a Portuguese-registered company:

Expat founders who relocated to Portugal and incorporated a local Lda for their startup or consulting business
International groups opening a Portuguese subsidiary or sales office
Real estate investors using a Portuguese SPV (special purpose vehicle) to hold property
Digital nomads and remote founders using Portugal as an EU base
Investors applying for residency programmes (D2 entrepreneur visa, Golden Visa, IFICI) via business activity

The 3 most common company structures

Sociedade por Quotas — Lda (Limited Liability Company)

The most common structure for foreign-owned operating businesses. Minimum 2 shareholders, EUR 1 minimum share capital per shareholder (in practice EUR 5,000–10,000 is recommended for credibility). Shareholders can be natural persons or other companies, Portuguese or foreign.

Liability: limited to share capital
Governance: 1 or more managers (gerentes); manager can be a non-resident
IRC rate 2026: 20% on first EUR 50,000 (SME); 21% above
Setup time: 1–3 business days via Empresa na Hora

Sociedade Unipessoal por Quotas (Single-Shareholder Lda)

Same legal regime as Lda, but with a single shareholder. Useful for solo expat founders or wholly-owned foreign subsidiaries.

Single shareholder: can be natural person or legal entity
Restriction: the same person can only own ONE Unipessoal Lda — a second wholly-owned company must be a different structure or have a corporate parent
Tax treatment: identical to multi-shareholder Lda

Sucursal (Branch) of a foreign company

A branch is not a separate legal entity — it is the foreign parent operating in Portugal. Less common for new ventures but used by established multinationals testing the market.

Tax: branch profits taxed at IRC rates (20%/21%)
Liability: parent is fully liable for branch obligations
Reporting: branch must keep separate Portuguese accounting + file Modelo 22 annually

NIF and fiscal representative — the prerequisites

Tax number (NIF)

Every shareholder, manager, and the company itself need a Portuguese tax identification number (NIF). For foreign individuals:

EU/EEA residents: can request the NIF directly at any Finanças office or online via Portal das Finanças, presenting valid ID
Non-EU residents: must appoint a fiscal representative simultaneously with the NIF request
Process time: usually same-day if requested in person; 1–2 weeks if requested through a representative

Fiscal representative

A fiscal representative is mandatory for non-EU/EEA residents who hold tax obligations in Portugal (NIF holders, shareholders, etc.). The representative:

Receives all communications from the Portuguese tax authority on your behalf
Is jointly liable for ensuring filings happen on time
Must have a Portuguese tax address and accept the appointment formally
Can be a person or a company (HVR provides this service for clients)

For EU/EEA residents the fiscal representative is optional. We recommend appointing one anyway if you don't speak Portuguese, simply for practical reasons — Finanças letters are in Portuguese only.

Corporate tax (IRC) — the 2026 numbers

Portugal's corporate income tax (IRC) for tax year 2026:

SMEs: 20% on the first EUR 50,000 of taxable profit, 21% on the remainder
Larger companies: 21% on all taxable profit
Municipal surcharge (derrama municipal): 0–1.5% depending on the municipality where the company operates (Lisbon: 1.5%)
State surcharge: 3% on profits between EUR 1.5M and EUR 7.5M; 5% from EUR 7.5M to EUR 35M; 9% above EUR 35M
Madeira Free Trade Zone: 5% (with substance and licensing requirements)

Effective tax rate for a typical foreign-owned SME in Lisbon: around 22–23% on profit up to EUR 50,000.

Withholding on dividends to non-resident shareholders

When a Portuguese company distributes dividends to non-resident shareholders, the Portuguese tax authority withholds tax at source:

Standard rate: 28% (or 35% for residents in low-tax jurisdictions on the Portuguese blacklist)
Reduced via double tax treaty: typically 5% (when shareholder is a company holding ≥10% for ≥1 year) or 15% (otherwise)
EU Parent-Subsidiary Directive: 0% withholding when paying dividends to an EU parent holding ≥10% for ≥1 year

To claim treaty benefits you must file a Modelo 21-RFI form, signed by the foreign tax authority, before the dividend is paid. HVR handles this end-to-end for clients.

VAT (IVA) — registration and rates

Standard rate (mainland): 23%
Intermediate rate (mainland): 13% (e.g. restaurants)
Reduced rate (mainland): 6% (e.g. essential goods, books)
Madeira: 22% / 12% / 5%
Azores: 16% / 9% / 4%
Small enterprise threshold: EUR 15,000 turnover (companies below this can opt out of charging VAT)

For B2B services to other EU companies, the reverse-charge mechanism usually applies. For B2C cross-border digital services, the EU OSS (One-Stop Shop) regime is mandatory above EUR 10,000 of cross-border turnover.

Monthly accounting — what's actually included and how much it costs

Mandatory monthly tasks

Document classification and bookkeeping (purchases, sales, expenses, banks)
VAT return (monthly or quarterly depending on turnover)
Bank reconciliation
Payroll (if employees) — monthly DMR Social Security declaration + IRS withholding
Year-end: IES (annual reporting), Modelo 22 (corporate tax), Modelo 30 (withholding declarations to non-residents)

Typical pricing in Lisbon (2026)

Real-market bands for foreign-owned SMEs:

EUR 150–250/month — entry-level: small Lda, <30 documents/month, 0–2 employees, simple operations
EUR 300–500/month — mid-market: 30–200 documents/month, 3–10 employees, multi-currency clients, standard reporting
EUR 600–1,200/month — premium: 200+ documents, 10+ employees, multi-entity reporting, investor reporting, M&A activity

HVR's pricing calculator takes 5 questions and recommends the right band.

First-year timeline for a new foreign-owned company

What to expect month-by-month after incorporation:

Month 1: NIF for shareholders/managers, incorporation, bank account opening, VAT registration if applicable
Month 2: First monthly accounting cycle, first VAT return, set up payroll if hiring
Month 3–6: Steady-state operations, quarterly checkpoint review
Month 7: First IES filing if your fiscal year ends June (most companies follow calendar year)
Month 10–12: Year-end planning — provisions, depreciation, tax-efficient distributions
Year 2 January: SAF-T file generation, IES preparation, Modelo 22 due 31 May

Special situations

NHR / IFICI for the founder

If the foreign founder also moves to Portugal as a tax resident, they may qualify for the IFICI regime (formerly NHR 2.0) which provides a 20% flat rate on Portuguese income from qualifying activities + exemptions on most foreign passive income. The application deadline is 15 January of the year following becoming tax resident.

Holding structure with a Portuguese SGPS

For groups with multiple subsidiaries, a Portuguese holding (SGPS — Sociedade Gestora de Participações Sociais) can offer a participation exemption on dividends and capital gains from qualifying participations. Substance and timing requirements apply.

Real estate via a Lda

Foreign-owned Ldas holding Portuguese property must keep accounting, file IES + Modelo 22, and pay corporate tax on rental income (IRC) instead of personal income tax (IRS). Capital gains on disposal are fully taxable at IRC rates. See our real-estate accounting service page.

Why work with HVR

Bilingual team — all communications, reports and contracts available in English
Fiscal representation — HVR can act as your fiscal representative directly
End-to-end company setup — from NIF to incorporation to first VAT return
Transparent pricing — fixed monthly fees, no per-invoice billing surprises
Specialised in foreign-owned SMEs — 200+ companies served including dozens with non-Portuguese owners
Online portal — 24/7 access to your documents and reports

Schedule a free 30-minute diagnostic →

Frequently Asked Questions

Can I open a Portuguese company without flying to Portugal?

Yes. The full process can be done remotely if you grant power of attorney to a trusted Portuguese representative (usually your accountant or lawyer). You will still need to apostille documents in your home country.

What's the difference between a Lda and a Unipessoal Lda?

Legally and fiscally they are nearly identical. The difference is the number of shareholders: Lda requires 2 or more, Unipessoal has exactly 1. Choose Unipessoal for solo founders or wholly-owned subsidiaries; Lda for partnerships or co-founders.

Do I need to maintain accounting in Portuguese?

The official accounting records (chart of accounts, journal entries, year-end financial statements) must be in Portuguese and follow Portuguese SNC standards. Your accountant handles this. Internally you can keep parallel English management reports — HVR provides these on request.

How long does company incorporation take?

Empresa na Hora ("company in an hour") can deliver an active Lda the same day if all parties are physically present. With remote shareholders + power of attorney, allow 5–10 business days for document apostilles + scheduling.

What happens if my company doesn't trade for a while?

A dormant Portuguese company still has filing obligations: monthly VAT (zero return), annual IES, annual Modelo 22, monthly DMR if there are managers. Minimum monthly accounting cost still applies (~EUR 100/month for true dormant). Liquidating an unused company costs EUR 500–1,500 plus accountant fees.

Can the manager be paid as a non-resident?

Yes. Managers (gerentes) can be paid through Portuguese payroll regardless of residence. If the manager is a non-resident, withholding rules + double tax treaty rules apply. We model this case-by-case.

Are dividends from a Portuguese SGPS exempt?

Dividends received by an SGPS from a qualifying participation (≥10% held for ≥1 year) are exempt from IRC under the participation exemption regime. The exemption flows through to the SGPS shareholders only at the moment of distribution from the SGPS — the regime defers tax, it doesn't eliminate it.