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Self-Employment Registration for a Freelancer in Portugal
Updated: February 15, 2023 | Natalia
Portugal offers plenty of opportunities for freelancers. Think thriving start-up scene, modern coworking spaces, networking events and opportunities, stunning landscapes, and beautiful areas to work from. As of 2020, an estimated 16.9 percent of people in Portugal are self-employed workers or freelancers.
Before starting as a freelancer in Portugal, you must first register as a freelancer. This article will go through all the information you’ll need to register as a freelancer in Portugal.
What does registering as a freelancer do?
Registering as a freelancer in Portugal allows you to:
- Work legally in Portugal
- Pay taxes and access the tax system
- Calculate your income tax
- Access the social security system
- Pay mandatory social security contributions
- Apply for residency and renew your residence permit
- Rent/buy a legal residence
- Issue official invoices (recibos verdes) to your clients
Requirements for Registering as a Freelancer in Portugal
Whether you’re a freelancer thinking about moving to Portugal or you’re a resident of Portugal dreaming about starting your freelance career, you need to meet the following requirements when registering.
Have permission to live and work in Portugal
To work as a freelancer in Portugal, you need a legal residence permit and a work permit. If you’re a citizen of any EU, EEA country, or Switzerland, you do not need a visa to live and work in Portugal. You may need a visa if you’re not an EU citizen.
Visas granting a legal residence permit and work permit
If you’re a foreign national, you may need a visa allowing legal residence and work permissions in Portugal. We’ve outlined the types of visas available in our articles, Working Remotely in Portugal and Portugal Work Visa.
If you’re a freelancer working for a company outside of Portugal, we’d recommend applying for Portugal’s Digital Nomad Visa. This allows remote work for an extended period and grants a residence permit.
For entrepreneurs, the D2 Visa is a good option, enabling you to work remotely as a freelancer if you’re setting up a business in Portugal.
Finally, the Golden Visa scheme is a residency-by-investment program. In exchange for investing in Portugal’s real estate market or culture and heritage sector, you can enjoy residency and work permissions in the country.
Contact your local Portuguese Embassy or Portuguese Consulate to apply for a visa in Portugal. If you’re already in Portugal, book an appointment with the Portuguese Immigration and Border Services (SEF).
The first step for the Portugal Golden Visa is to decide on your investment pathway. We recommend speaking with experts in the field to understand your options and which is the best route option for your specific needs.
Have a NIF
The Portuguese tax identification number is known as the NIF or the Número de Identificação Fiscal. This unique nine-digit number allows you to carry out any financial activity in Portugal, so you’ll need one to get your NISS and open a bank account before you can start freelancing.
The NIF will also allow you to pay income tax. The Portuguese tax authority (autoridade tributária) is responsible for issuing these tax numbers. You can get a NIF by visiting a tax office (Finanças) with the required documentation consisting of a photo ID and proof of residence.
Alternatively, you can apply for a NIF through our website, and you’ll receive your NIF in two to three weeks. This is an excellent option for foreign nationals, as non-EU citizens must have a tax representative to get their NIF. Our tax representatives can help you get a NIF from anywhere in the world, for any nationality.
Obtain a NISS
Portugal’s social security identification number is known as the NISS (Número de Identificação da Segurança Social).
Self-employed individuals must pay taxes to the Portuguese government depending on their monthly income. The NISS allows you to pay social security contributions.
You can apply for a NISS at a social security office, known as Centro Nacional de Pensões or at Loja do Cidadão. You will need to provide a valid passport or ID card, a tax identification number, and proof of address.
It’s important to note that obtaining a NISS is a crucial step in accessing social security benefits in Portugal, including healthcare, unemployment, and pensions. So, make sure you obtain your NISS as soon as possible after arriving in Portugal.
Portugal prides itself on its social security contribution system, so make sure that you’re contributing the correct amount. Read this article for more detailed information about getting a NISS.
Open a Portuguese bank account
When registering as a freelancer in Portugal, you need to have a Portuguese bank account and IBAN to share with Finanças.
Opening a bank account in Portugal is relatively straightforward. You will need:
- A NIF
- Proof of address from your country of origin or in Portugal
- Proof of income or employment
- A deposit (this varies depending on the bank and account type)
We can help you open up a Portuguese bank account from anywhere in the world with a major Portuguese bank such as BCP Millennium or Novo Banco.
Register the opening of an activity with Finanças
Once the above steps are completed, you can register the opening of business activity with Finanças, the Portuguese tax authority’s website.
You’ll need to provide detailed information about the services you will offer, the date that represents the estimated start date of your activity, and your projected annual income. Finanças can then gauge both your personal income tax and whether you need to pay value-added tax (VAT) and how much.
Finanças will also then group you into a particular category depending on the nature of your work. This is done through activity codes (código de atividade). You can see what code your work falls under Article 151 of the CIRS.
Certain groups are VAT-exempt or have a limit on the amount of VAT-free income you can generate. For example, Category B self-employed workers do not pay VAT on incomes under €12,500.
You will be asked to choose between two accounting regimes; simplified (regime simplificado) or organized (contabilidade organizada). You can choose the simple regime if you do not have an accountant. If you earn more than €200,000 annually, you must select the organized regime and hire an accountant. The downside to the simple regime is that it doesn’t allow for business expenses.
Once you’ve opened this activity with Finanças, you’re ready to start issuing official invoices (recibo verdes) through the website and have successfully registered as a freelancer in Portugal.
The non-habitual residency tax regime for freelancers
If you’re relocating to Portugal and have not been a tax resident there in the last five years, you could be eligible for NHR (non-habitual residency) tax status.
If your clients are from outside of Portugal, we’d strongly recommend obtaining NHR status as freelancers only have to pay 20 percent income tax on self-employment. Once you have your NIF, you can register as a NHR through the tax authority’s (Finanćas) web portal.
Top tip: You can read about NHR in our article, NHR for Digital Nomads.
Creating a Company in Portugal
Most freelancers in Portugal do not register their business as a company because registering as an individual incurs fewer social security fees and taxes.
It’s important to note that if you want to sell products, you must register with the tax authority as a company. In the eyes of Portuguese law, you will be seen as an Empresário em Nome Individual or ENI, the single owner of a company that sells products and may provide services.
To Wrap Things Up
The tax year follows the traditional calendar, running from January to December. Annual tax declarations need to be made before April of the following year, e.g if you started earning money from freelancing in July of 2022 then it needs to be declared by April of 2023. This will help you and the tax authorities calculate your taxable income.
It’s essential to stay in the loop and be informed about tax payments and self-employment registration in Portugal. Freelancers can benefit from the high quality of life and all the riches that Portugal offers, but we don’t want an unexpected fine to ruin your time here.
To live in Portugal as a freelancer, it’s essential to, first and foremost, have your NIF. If you need a NIF number or a Portuguese bank account, then GetNIFportugal can help you.
We’ll do the work so you can receive your NIF number and get your Portuguese bank account up and running as quickly as possible, meaning that when the time comes to register yourself at the tax authority office, you’ll be good to go.
Frequently asked questions
Can I work as a freelancer in Portugal?
Yes. If you have the right to live and work in Portugal, you can register as a freelancer with Finanças once you have your NIF and Portuguese bank account.
Is there a Portugal self-employed visa?
If you’re looking for a visa that will let you register as a freelancer, we would recommend signing up for the Digital Nomad Visa, the D2 Visa, or the Tech Visa.
If you contact your local Portuguese Consulate or Portuguese Embassy, they can tell you what visas you’re eligible for.
How much tax does a freelancer pay in Portugal?
The average contribution rate in Portugal for an independent contractor is 21.4 percent. However, this amount can vary depending on the contractor’s income.
How many freelancers are in Portugal?
Almost 17 percent of the population in Portugal are self-employed or work as freelancers, according to World Bank data from 2020. This is higher than the European Union average of 15.2 percent, indicating that many freelancers are in Portugal.
How do I register as a freelancer in Portugal?
You can register as a freelancer in Portugal by following the steps outlined above. To keep things really simple, you can register by:
- Having residency and work rights
- Obtaining a NIF
- Opening a bank account
- Registering the start of your business activity
- Getting a NISS
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