Major reasons to invest in Portugal are because the country:
- Has some of the lowest operational costs in Western Europe
- Gives fast, easy and access to the EU single market
- Is a founder member of and full participant in the European Monetary Union
- Boasts a superb investments track record, with many firms bringing new projects to Portugal
- Is home to Europe’s youngest and most enthusiastic workforces, with first-rate training facilities
- Has high levels of productivity growth in both manufacturing and services
- Offers a wide range of sites and buildings at highly competitive prices and ready to use
- Offers good domestic logistics and communications infrastructure (is the world’s 12th country with better infrastructure)
- Offers high quality support services for investors, both during and after investment
- Has one of Europe’s best records for industrial relations
- Has a large network of treaties for the relief of double taxation and many of the Portugal-based companies also benefit from an exemption from corporation tax on dividends that they receive from subsidiaries
- Allows residents to enjoy a high quality of life with one of the continent’s lowest crime rates
Excluding the acquisition of a Portuguese company, the commonest ways of investing in
Portugal are to:
- Set up a company
- Set up a branch.
The most common type of companies in Portugal are the shareholders company (SA) and the limited liability company (LDA), which have in common the fact that the responsibility of the shareholders or of the quota-holders is generally limited to their interest in the capital of the company.
There are also other ways of investing in Portugal, for example through joint ventures and partnerships, although these are less commonly used.
The taxation of resident companies is regulated by the Corporate Tax Code (IRC), approved by the Decree-Law 442-B/88 of 30 November 1988 with several amendments; the latest one was introduced by the Law 82-B/2014 of 31 December 2014.
Commercial collective persons, or civil collective persons, and in a general way, all collective persons which have their head offices in Portugal, collective entities which have no legal personality, and entities which may or may not have their head office in Portugal, but receive income in Portugal, are subject to corporate tax.
The following operations are subject to VAT:
- Transmission of goods
- Rendering of services
Importation of goods.
According to the rules of the European Union, most part of the services performed by nonresidents to residents in Portugal, who are registered for VAT purposes, are deemed to be performed in Portuguese territory and consequently subject to the Portuguese internal VAT.