Hiring Cost Calculator 2026
The real cost of an employee for a company in Portugal is, on average, 24-25% above gross salary: employer Social Security (TSU) of 23.75% plus work-accident insurance (around 1%), plus holiday and Christmas subsidies and the meal allowance.
What makes up the hiring cost
- Gross salary — the agreed base remuneration.
- Employer TSU (23.75%) — the company Social Security contribution.
- Work-accident insurance — mandatory, around 1% (varies with activity).
- Holiday and Christmas subsidies — two extra months per year, with TSU.
- Meal allowance — a full cost; only the part above the exempt limit (EUR 6.15 cash / EUR 10.455 card) bears TSU.
Note: contributions to the FCT (Labour Compensation Fund) were abolished and those to the FGCT are suspended (article 4 of Decree-Law 115/2023), so neither adds to the cost today.
What the calculator does
Enter the gross monthly salary, whether it is paid in 14 instalments or in 12 with the subsidies spread as twelfths, the work-accident insurance rate for your activity and the meal allowance (card, cash or none, with the daily amount and working days). The calculator returns the monthly and annual cost to the company and how far that cost sits above the gross salary.
Legal basis
- Social Security — the general contribution rate is 34.75%: 23.75% paid by the employer and 11% deducted from the employee (article 53 of the Contributory Code, Law 110/2009).
- Work-accident insurance — employers must transfer this liability to an authorised insurer (article 79 of Law 98/2009). The premium depends on the activity and the insurer.
- Holiday and Christmas subsidies — each worth one month of pay (articles 263 and 264 of the Labour Code).
- Meal allowance — tax and Social Security free up to EUR 6.15/day in cash and 70% more on a meal card (article 2(3)(b)(2) of the IRS Code). The EUR 6.15 public-sector rate was set for 2026 by Portaria 51-B/2026/1.
Worked example
A EUR 1,300 gross monthly salary with 1% accident insurance costs the company EUR 1,621.75 a month (EUR 308.75 of TSU and EUR 13 of insurance), or EUR 22,704.50 a year over 14 payments. Adding a EUR 10.455 meal card for 22 days a month over 11 months (EUR 2,530.11, with no TSU) brings the annual cost to about EUR 25,235.
What the calculator leaves out
Occupational health and safety services, the 40 hours of annual training each employee is entitled to (article 131 of the Labour Code), overtime and benefits beyond the meal allowance are not included. Nor are public hiring incentives, which can lower the cost.
Need help with payroll and optimising your hiring cost? See HVR accounting and payroll.
Frequently asked questions
How much does an employee cost beyond salary in Portugal?
On average, an employee costs about 24-25% above gross salary: 23.75% employer Social Security (TSU) plus work-accident insurance (~1%). Holiday and Christmas subsidies and, where applicable, the meal allowance add on top. Contributions to the FCT were abolished and those to the FGCT are suspended (article 4 of Decree-Law 115/2023), so neither adds to the cost today.
What is the employer TSU?
It is the company contribution to Social Security: 23.75% of the worker remuneration, paid monthly by the employer, on top of the 11% deducted from the worker.
Does the meal allowance have employer costs?
The meal allowance is a full cost to the employer. Only the part above the exempt limit (EUR 6.15/day in cash or EUR 10.455/day on a card) is subject to TSU.
Do holiday and Christmas subsidies count toward the cost?
Yes. They are two extra months of salary per year and are subject to TSU, so they must be included in the annual hiring cost.
How can I reduce hiring costs?
With charge-exempt benefits (meal card, health insurance within limits), the IRS Jovem regime for workers up to 35, and public hiring support.