
Residents of Portugal are subject to tax on their worldwide income. Nonresidents are subject to personal income tax on income arising in Portugal.
An individual is considered resident in Portugal if, among other conditions, he or she meets either of the following conditions:
- He or she stays in Portugal for more than 183 days in any 12-month period, beginning or ending in the fiscal year concerned.
- He or she has a dwelling in Portugal, in any day of the above-mentioned period, which may imply his or her intention to use it as his or her habitual residence.
As a rule, individuals that meet the above conditions become tax residents in Portugal from the first day of permanence in Portugal. As a result of the above two conditions, it is possible to split the year for tax purposes.
Despite the possibility to split the year for tax purposes, some additional rules apply. The loss of the tax resident status occurs from the last day of permanence in Portugal unless the individual remains in Portugal more than 183 days in the departure year and, after the departure, derives any Portuguese-source income that would otherwise be subject to tax (as a resident of Portugal). In such case, he or she will continue to be considered tax resident of Portugal for the whole year, unless certain conditions are met. If a tax resident leaves Portugal and returns in the following year (after becoming nonresident of Portugal), that individual is deemed Portuguese tax resident for the prior year (year in which he or she had previously been deemed a nonresident), according to the Portuguese domestic law.
The tax status (resident versus nonresident) should be updated within 60 days (that is, the taxpayer must communicate any change to the tax authorities).
As a result of the elimination of the spouse attraction rule, tax residency is now determined with respect to each taxpayer separately.
Income subject to tax. The taxation of various types of income is described below.
Employment income. Personal income tax (IRS) is imposed on the earned income of employed individuals.
Business and professional income. Taxable income includes all earned income of a professional individual, including commissions and profits from a trade. Business and professional income is taxed at the personal income tax rates listed in Rates and may be subject to one of the following two regimes:
- Simplified regime
- Organized bookkeeping regime
Income may be taxed under the simplified regime if the taxpayer does not choose to use, and is not required to use, organized bookkeeping and if the annual gross business and professional income of the taxpayer did not exceed EUR200,000 in the preceding year.
Directors’ fees. Directors’ fees are taxed in the same manner as employment income.
Investment income. A withholding tax of 28% is imposed on interest income derived from public company bonds and state bonds and on bank interest. Dividends paid by resident companies are subject to a 28% final withholding tax. Withholding taxes are final with respect to the following:
- Dividends
- Bank in terest
- Interest on shareholders’ loans
- Interest from public company bonds, bills or other paper
- Interest on public debt
The taxpayer may elect to include these items in taxable income in the tax return unless they are obtained within the scope of a business or trade activity. If the taxpayer makes the election, the income is taxed at the rates set forth in Rates, with a credit given for the tax withheld (a 50% relief applies to dividends received from resident companies subject to corporate tax or from European Union (EU) companies that fulfill the requirements of the EU Parent-Subsidiary Directive).
In general, other investment income is subject to a final withholding tax of 28%.
Rental income and royalties are subject to withholding tax at rates of 25% and 16.5%, respectively. Most of the costs effectively borne by the landlord to obtain the rental income, except financial costs, depreciation and the purchase of furniture, domestic appliances and decorations, are deductible from the rental income. Expenses related to maintenance and repair of the property incurred and paid in the 24 months before the beginning of the lease are also deductible from the rental income under certain conditions. The landlord must keep the supporting documentation and present it, if requested. The expenses can be deducted only against the income of each property and carryforward of losses is allowed for a six-year period under certain conditions.
Rental income is subject to a 28% flat tax rate. However, the taxpayer may elect to include rental income in the taxable income in the tax return. If the taxpayer makes the election, the income is taxed at the rates set forth in Rates, with a credit given for the tax withheld. Royalties are taxed at the personal income tax rates set forth in Rates, with a credit available for the withholding tax.
Capital gains and losses. Taxable capital gains that are not specifically exempt or taxed separately are taxed at the ordinary rates listed in Rates. No withholding tax applies. In general, gains de rived from sales of the following assets are taxed at the personal income tax rates set forth in Rates:
- Real estate and associated rights
- A taxpayer’s property transferred to the taxpayer’s business (however, this gain may be deferred; see below)
Capital gains derived from sales of the following assets are exempt from tax:
- Securities acquired before 1 January 1989
- Real estate, except land for construction, owned prior to 1 January 1989
- A personal residence if, among other conditions, the proceeds are reinvested in another personal residence in Portugal (or in other EU member states or European Economic Area (EEA) countries that have entered into an exchange-of-information agreement with Portugal concerning tax matters) within 36 months after the sale or 24 months before the sale
- A personal residence if the proceeds are used to repay loans under certain circumstances (temporary measure for loans granted on or before 31 December 2014 and sales of property between 2015 and 2020)
The following capital gains benefit from special tax treatment:
- Gains derived from the sale of real estate or associated rights, excluding real estate used in a trade or business, are taxed only to the extent of 50% of the gain.
- Gains derived from transfers of a taxpayer’s property to the taxpayer’s business are deferred until a subsequent disposition of the property occurs, and only 50% of the gain is taxed.
- Gains derived from the sale by non-original owners of copyrights, patents and various other types of intellectual property are taxed only to the extent of 50% of the gain.
- Gains derived from disposals of securities (including disposals of autonomous warrants, redemptions of bonds and other debt securities, redemptions of participation units of investment funds, receipts of liquidation proceeds, assignments of credits and assignments of supplementary capital contributions or ancillary contributions) and derivative financial products are subject to tax at a rate of 28% (a 50% exclusion from tax applies to gains from shares in unlisted micro and small companies) if an exemption does not apply. An exemption may apply to nonresidents under domestic rules or an applicable double tax treaty.
In calculating the capital gain derived from the sale of real estate or securities, the purchase price is indexed by an official government coefficient to account for inflation if the sale occurs more than 24 months after the purchase.
Capital losses may offset capital gains only.
Taxation of employer-provided stock options. Income derived from employer-provided stock options is taxed in the same manner as employment income (see Employment income).
Taxation of residents in EU member states and EEA countries that have entered into an exchange-of-information agreement with Portugal concerning tax matters. Residents of EU member states and EEA countries that have entered into an exchangeof-information agreement with Portugal concerning tax matters may opt to be taxed as if they were tax residents of Portugal. This option is available for certain capital gains and other income that are not attributable to a permanent establishment and are not liable to definitive taxation. It may also apply if the individual’s Portuguese-source income is at least 90% of his or her worldwide income derived during the relevant tax year. In determining the tax rate applicable to the income mentioned above, worldwide income must be considered and reported.
Taxation of non-habitual residents. A special regime applies to individuals who become tax residents of Portugal and have not been taxed as such in any of the previous five years. Non-habitual resident status applies for up to 10 years, and requires the taxpayer to be registered as non-habitual resident with the tax authorities. Principal aspects of this regime are summarized below.
technical nature (including activities of architects and engineers, artists, auditors and tax advisors, physicians, teachers, other professionals, board members on companies with approved investment projects and senior employees), are taxed at a flat rate of 20% on net income, plus a surcharge of up to 3.5% in 2016.
Foreign-source income, such as employment income, income from certain business or professional activities (as listed above), income from copyrights, industrial property rights or transfer of know-how, investment income, rental income and capital gains, is exempt from tax in Portugal if such income is effectively taxed (for employment income) or may be taxed (for other types of income) in either of the following countries:
- A tax treaty country.
- A non-tax treaty country in accordance with the Organisation for Economic Co-operation and Development (OECD) Model Tax Convention rules, provided that the country is not a territory considered a tax haven (not applicable to employment income) and that the income cannot be deemed sourced in Portugal under domestic tax law.
Foreign-source pension income not resulting from contributions that have been claimed as a tax deduction in Portugal is exempt from tax in Portugal if such income is taxed in a tax treaty country or is not deemed sourced in Portugal under domestic tax law.
Income benefiting from the exemption method is considered to determine the tax rate applicable to the remaining income (except capital gains from securities, dividends, interest and other investment income sourced abroad, rental income and employment and business or professional income subject to the 20% rate mentioned above, which are taxed at special flat rates). Taxpayers may opt to apply the credit method (rather than the exemption method) to this income. In such case, such income is aggregated with the remaining income and taxed at the normal IRS rates.
Exemption for outbound expatriates working abroad. An exemption for outbound expatriates (working abroad) has been applicable since 2015. The exemption applies to employment income, in the part corresponding to the compensation for travel and stay abroad that exceeds the legal limits foreseen in the Personal Income Tax Code, earned by tax resident individuals temporarily assigned abroad for a period of not less than 90 days (of which 60 are consecutive days).
The exempt amount cannot exceed the higher of the following:
- The difference between the annual employment income subject to tax of the individual, including compensation, and the total amount of his or her regular employment income subject to tax in the preceding year
- EUR10,000
This regime operates as an exemption with progression. The exemption also applies to nonresident individuals with a limit of three years from the date of the assignment.
Deductions
Personal deductions and allowances. For 2016, employees may deduct an amount of EUR4,104. Compulsory social security contributions in excess of EUR4,104 are deductible without limitation. Union contributions and indemnities paid to employers may also be deducted, subject to applicable limits.
Business and professional deductions. Professionals and individuals carrying on a business may be taxed under one of the following two regimes:
- Simplified regime
- Organized bookkeeping regime
Business and professional income may be taxed under the simplified regime if the taxpayer does not choose to use and is not required to use organized bookkeeping and if the annual gross business and professional income for the preceding year did not exceed EUR200,000.
Under the simplified regime, taxable income is calculated by applying the following predefined coefficients, which vary depending on the activity’s sector, to gross income:
- 15 on sales of goods and products, as well as hotel and similar services, food and beverages activities
- 75 on income from professional activities (that is, services rendered) listed in the table referred to in Article 151 of the Personal Income Tax Code and 0.35 for the remaining activities
- 95 on income from intellectual or industrial property, royalties, investment income from a trade or business and other income from capital gains, rentals and net worth increases
- 30 on non-operating subsidies or grants, such as subsidies or grants for the purchase of equipment
- 10 on operating government subsidies (for example, grants for personnel training) and other business and professional income not mentioned above
- Income derived from services rendered by partners to a company taxed under the tax transparency regime
Taxpayers earning income from professional activities or other services rendered can deduct from taxable income compulsory social security contributions, in excess of 10% of the gross business and professional income, which have not been claimed as deductions for any other purpose.
Coefficients on the taxable income for services rendered and non-operating subsidies are reduced by 50% and 25%, in the first and second years of activity, if certain requirements are satisfied. This benefit does not apply if the entrepreneurs have ceased their activity in the last five years.
The simplified regime ceases to apply if the qualifying limit is exceeded for two consecutive years or by more than 25% during a single year.
The organized bookkeeping regime provides for the deduction of activity-related expenses. Taxable income is calculated using the corporate tax rules, with additional limitations imposed on the deduction of the following expenses:
- Amounts booked as remuneration paid to the self-employed individual are not deductible.
- Amounts booked as per diem allowances, kilometer allowances, meal allowances and other remuneration allowances are not deductible.
If a professional’s house is partially used as an office, the professional may deduct certain expenses, including rent, electricity, water and telephone costs, and depreciation, up to 25% of the total amount of expenses incurred.
Certain expenses are taxed autonomously, triggering an additional tax burden. These expenses include the following:
- Undocumented expenses are not tax-deductible and are subject to a surcharge of 50%.
- Entertainment expenses that are deductible from gross business or professional income are subject to a 10% surcharge.
- Expenses deductible from gross business or professional income that are related to cars (except electric cars) are subject to a 0%, 10% or 20% surcharge, depending on the nature and acquisition cost of the vehicle.
- Per diems and expenses related to the use of a personal car by the employee for the company’s business are taxed at a rate of 5% if such expenses were not charged to clients or taxed as employment income.
- Payments to nonresident entities that are subject to a favorable tax regime are not tax-deductible and are subject to a 35% surcharge if it cannot be proved that these expenses relate to operations effectively performed, that the payments are normal for the type of activity and that the amount is not unreasonable.
Rates. The following personal income tax rates apply for 2016.
Taxable income (EUR)
Exceeding Not exceeding
|
Tax on
lower amount |
Rate on excess % |
|
0 | 7,035 | 0 | 14.50 |
7,035 | 20,100 | 1,020 | 28.50 |
20,100 | 40,200 | 4,744 | 37.00 |
40,200 | 80,000 | 12,181 | 45.00 |
80,000 | — | 30,090 | 48.00 |
For married taxpayers, the progressive tax rate is determined by dividing taxable income by two.
For 2016, taxable income exceeding EUR80,000 but not exceeding EUR250,000 is subject to an additional solidarity tax of 2.5%, and taxable income exceeding EUR250,000 is subject to an additional solidarity tax of 5%.
In addition, for 2016, taxable income exceeding EUR7,070 is subject to an extraordinary surcharge of up to 3.5%. This rate also applies to non-habitual residents that benefit from the 20% flat tax rate.
Credits. For 2016, individuals may credit the following amounts against their tax liability:
- EUR600 for each child (EUR725 for each child who is younger than three years old).
- EUR525 for each ascendant who lives with the taxpayer and does not receive income above the minimum social security retirement pension. This credit is increased to EUR635 if only one ascendant lives with the taxpayer.
- 35% (45% for single-parent families) of general expenses borne by any member of the household, with the limit of EUR250 (or EUR335 for single-parent families) per taxpayer.
- For health expenses that are exempt from value-added tax (VAT) or are subject to VAT at a rate of 6%, 15% of unreimbursed medical expenses, and health insurance premiums of the taxpayer or any member of the household. The tax credit cannot exceed EUR1,000.
- 15% of interest on certain loans and financial leasing rent for the acquisition or improvement of a residence in Portugal or a country in the EU or EEA (with which Portugal has entered into an exchange-of-information agreement concerning tax matters), limited to EUR296, and 15% of the rental payments made to the owner of a residence in Portugal or a country in the EU or EEA (with which Portugal has entered into an exchange-of-information agreement concerning tax matters), limited to EUR502. These limits may be increased for taxpayers with lower levels of income.
- 30% of education expenses of the taxpayer or any member of the household, limited to EUR800.
- 25% of expenses incurred on retirement homes and similar homes, limited to EUR403.75.
- 15% of the VAT borne in the following sectors, limited to EUR250:
— Maintenance of motor vehicles
— Maintenance and repair of motorcycles
— Accommodation and food services
— Hairdressers and beauty salons
— Services rendered by veterinarians
- 20% of pension fund contributions that meet certain conditions, limited to EUR300, EUR350 or EUR400 per taxpayer, depending on the taxpayer’s age.
- 25% of donations to the state or municipalities, increased by 20%, 30% or 40%, depending on the type of the beneficiary entities.
- 25% of donations to religious institutions, public utility collectives, schools, museums, libraries, cultural associations, and philanthropic and charitable institutions, increased by 30%, with the credit limited to 15% of the total tax liability.
- 20% of alimony payments.
- 20% of investments made by business angels (individual venture capital investors), provided certain conditions are satisfied, limited to 15% of the total tax liability.
- Advance personal income tax payments and taxes previously withheld at source.
To benefit from the credits, these expenses must be reported (generally by the suppliers) to the Portuguese tax authorities.
The tax credits concerning medical expenses, education expenses, alimony payments, retirement homes and expenses related to residential property, as well as tax benefits, are also capped as a whole in accordance with the taxpayer’s level of income, as shown in the following table.
Taxable income Limit
Up to EUR7,035 None
.
More than EUR7,035
and less than EUR80,000 EUR1,000 + (1,500 x
. [EUR80,000 – taxable . income]÷[EUR80,000 – EUR7,035])
.
EUR80,000 or more EUR1,000
Each of the above limits is increased in 5% for each dependent, in families with three or more dependents.
Relief for losses. Losses from business or professional activities may be carried forward and offset against profits from activities of the same type in the following 12 years. Losses may not be carried back.
Inheritance and gift taxes
Inheritance and gift taxes were eliminated, effective from 1 January 2004. However, stamp duty at a rate of 10% applies if the beneficiary is an individual (except for the spouse, ascendants and descendants who benefit from an exemption). For a beneficiary that is a collective person, a corporate tax applies at a maximum rate of 21%, plus the following surcharges:
- Municipal surcharge of up to 1.5% for residents or permanent establishments
- A state surcharge of 3% on taxable income between EUR1,500,000 and EUR7,500,000, 5% on taxable income between EUR7,500,000 and EUR 35,000,000, and 7% on taxable income exceeding 35,000,000
Specific rules apply to determine whether an asset is deemed to be located in Portugal for inheritance and gift purposes.
Social security
Contributions. Social security contributions are payable on all salaries, wages, bonuses and other regular income, excluding lunch subsidies. No ceiling applies to the amount of wages subject to social security contributions for employers or employees, including members of the board. The employer’s share is 23.75%, and the employee’s share is 11%, of salaries. An employer must deduct an employee’s contribution and pay the total amount by the 20th day of the following month.
A self-employed individual engaged in a business or professional activity is subject to monthly social security contributions calculated on a base preselected by the individual, which varies between 1 and 12 times the monthly notional salary. Currently, the monthly notional salary is EUR419.22. The following are the contribution rates for self-employed individuals:
- 6%, in general
- 3% or 34.75% for specific situations
Entities contracting service providers may be subject to a 5% social security contribution rate levied on the amount of services paid.
Members of a company’s governing bodies (management, supervisory and general meeting) are usually subject to social security contributions based on actual compensation. For contribution purposes, the actual compensation base must equal at least one monthly notional salary. This limit does not apply if members of the board are not remunerated and simultaneously carry on another remunerated activity that is liable to mandatory social security contributions and if the tax base is equal to or higher than EUR419.22, or in the case of pensioners.
For management, the rates are 11% for individuals and 23.75% for companies. For other governing bodies, the rates are 9.3% for individuals and 20.3% for companies.
For 2016, an extraordinary solidarity contribution is paid on pensions. This extraordinary solidarity contribution is due on all amounts paid as pensions (except the refund of capital for the beneficiaries’ contributions to lifelong annuities due from insurance companies). The rate is 7.5% on the amount between EUR4,611.42 and EUR7,126.74, and 20% on the amount exceeding EUR7,126.74. The extraordinary solidarity contribution is expected be eliminated in 2017.
Totalization agreements. Foreigners who work temporarily (up to two years) in Portugal and who contribute to a compulsory social security scheme in their country of origin may not be subject to Portuguese social security contributions. To provide relief from double social security contributions and to assure benefit coverage, Portugal has entered into totalization agreements, which generally apply for a period of 12 months (some agreements state a longer period, up to 60 months), with the following jurisdictions.
Andorra Estonia Norway
Angola* Finland Poland
Argentina France Quebec
Australia Germany Romania
Austria Greece São Tomé and
Belgium Guinea* Príncipe*
Brazil Hungary Slovak Republic
Bulgaria Iceland Slovenia
Canada Ireland Spain
Cape Verde Italy Sweden
Channel Islands Latvia Switzerland
(Guernsey, Herm, Liechtenstein Tunisia
Isle of Man, Lithuania Turkey
Jersey and Luxembourg Ukraine
Jethou) Malta United Kingdom
Chile Moldova United States
Cyprus Morocco Uruguay
Czech Republic Mozambique* Venezuela
Denmark Netherlands
* This agreement is not yet in force.
Portugal has also entered into a multilateral Ibero-American social security agreement covering the following jurisdictions.
Andorra* Cuba* Nicaragua*
Argentina* Dominican Republic* Panama*
Bolivia Ecuador Paraguay
Brazil El Salvador Peru*
Chile Guatemala* Spain
Colombia* Honduras* Uruguay
Costa Rica* Mexico* Venezuela*
* The agreement with these jurisdictions is not yet in force.
Type of taxable income | Withholding tax rates | |
Residents (%) | Nonresidents (%) | |
Employment income | (a) | 25 (b) |
Directors’ fees and similar fees | (a) | 25 (b) |
Business and professional services | 11.5/25 | 25 (b) |
Income royalties and copyright income | 16.5 | 25 (b) |
Commissions | 25 | 25 (b) |
Employment income and professional income derived by non-habitual residents from high value-added activities | 20 | _____________ |
Bank deposit interest | 28 (c) | 28 (b) |
Income from life insurance policies | 28 (c) | 28 (b) |
Interest from state bonds | 28 (c) | 28 (b) |
Dividends | 28 (c) | 28 (b) |
Gains arising on “swaps”, other credit operations, and other financial instruments | 28 (c) | 28 (b) |
Income from the use or concession of equipment | 16.5 | 25 (b) |
Rentals | 25 | 25 |
Pension | (a) | 25 (b) |
Other investment income (including other interest) | 16.5 | 28 (b) |
Certain indemnities | 16.5 | 25 (b) |
Investment income if beneficial owner is not disclosed | 35 (b) | 35 (b) |
Investment income obtained by residents in tax havens | ________________ | 35 (b) |
|
|
|
a) Withholding taxes deducted at progressive rates according to levels of income.
b) This is a final withholding tax; income need not be declared.
c) Income may be declared at the option of the taxpayer.
Married taxpayers who are not legally separated can opt for joint taxation if they file their tax returns by the legal deadline.
The tax year in Portugal is the calendar year. However, it is possible to split the year for tax purposes. Residents, as well as nonresidents who have filing obligations, with only employment income or pension income must file their personal income tax returns between 15 March and 15 April. Residents, as well as nonresidents who have filing obligations, with other income must file their returns between 16 April and 16 May. Any balance of tax due or excess tax paid is payable or refundable when the Portuguese tax authorities issue the respective tax assessment.
An extension to the filing of personal income tax returns with foreign tax credit is granted until 31 December of the year following the tax year. For that purpose, individuals must report the nature of the income and the country of source by the standard deadline for the personal income tax return filing (through Form 49) and subsequently file the return when the foreign tax assessment is available.
The foreign tax credit may be carried forward for five years.
Nonresidents who receive rental income from Portugal or who realize a capital gain in Portugal that is not excluded from taxation must file tax returns between 16 April and 16 May of the year following the year of receipt.
Double tax relief and tax treaties
Residents who receive foreign-source income are entitled to a tax credit equal to the lower of the foreign tax paid or the Portuguese tax payable on such income. The credit applies to income derived from treaty and non-treaty countries; however, for treaty countries, the credit is limited to the amount of tax payable in the country of source in accordance with the treaty.
Brokers resident in countries with which Portugal has entered into double tax treaties are exempt from tax on commissions received from Portuguese entities. This exemption also applies to income from business and professional services. Specific forms are required to qualify for the exemption.
Compulsory social security contributions and other deductible expenses (see Sections A and C) incurred overseas may be deducted if properly documented.
Portugal has entered into double tax treaties with the following jurisdictions.
Algeria Hong Kong SAR Peru
Austria Hungary Poland
Barbados (a) Iceland Qatar
Belgium India Romania
Brazil Indonesia Russian
Bulgaria Ireland Federation
Canada Israel San Marino (a)
Cape Verde Italy Senegal
Chile Japan Singapore
China Korea (South) Slovak Republic
Colombia (b) Kuwait Slovenia
Croatia Latvia South Africa
Cuba Lithuania Spain
Cyprus Luxembourg Sweden
Czech Republic Macau SAR Switzerland
Denmark Malta Tunisia
East Timor (a) Mexico Turkey
Estonia Moldova Ukraine
Ethiopia (a) Morocco United Arab
Finland Mozambique Emirates
France Netherlands United Kingdom
Georgia Norway United States
Germany Pakistan Uruguay
Greece Panama Venezuela
Guinea-Bissau
a) This tax treaty is not yet in force.
b) The tax treaty with Colombia took effect on 30 January 2015, except for taxes due at source and remaining taxes, for which the effective date was 1 January 2016.
Temporary visas
Visas for short-term stays (vistos de curta duragão) in Portugal include transit visas, tourist visas, student visas and business visas. They entitle non-EU citizens to spend up to 90 days in Portugal.
Foreign nationals must apply for temporary visas at the Portuguese consulates or embassies in their home countries or in their place of residence.
International travelers who are nationals of Visa Waiver Program countries do not require a visa to enter Portugal for short-term visits. However, their stay cannot exceed 90 days within any 180-day period.
Employment and self-employment visas
EU, EEA and Swiss nationals do not need permits to work in Portugal. An EU, EEA or Swiss national who intends to reside and work in Portugal must register with the local city hall if his or her stay exceeds 90 days.
Non-EU nationals must enter Portugal with the proper visas if they intend to carry out professional activities. The type of work permit and visa required and the required procedures to obtain these items differ depending on how the work relationship is classified (for example, as a self-employment activity or an employment activity).
The procedure for obtaining an employment visa for a foreign national is initiated by the prospective Portuguese employer (or the Portuguese entity for which the employees are assigned to work), which must first request a declaration to the Instituto de Emprego e Formação Profissional proving that the job offer is covered by the quota limits and has not been filled by a worker who enjoys preference. The approval and issuance of such declaration usually requires up to three months. This procedure is usually followed to fill available vacancies within the quota limits, which are established by a resolution taken by the Council of Ministers.
Workers for whom a temporary residence authorization can be requested are primarily the following:
- Executives or managerial employees assigned to the Portuguese branch or subsidiary of a foreign legal entity
- Highly skilled workers assigned to the Portuguese branch or subsidiary of a foreign legal entity for carrying out a specific project
Portugal is one of the countries that has implemented the EU Blue Card Directive, which enables companies to locally hire executives and high-skilled workers. To obtain the EU Blue Card, an individual must prove the following:
- For regulated professions specified in the employment contract, the adequate professional certification document, if applicable
- For professions that are not regulated, proof of higher professional qualifications in the occupation or sector specified in the employment contract
The application for the EU Blue Card should be submitted by a national of a third state or by the employer with the regional offices of the immigration authorities within the residence area.
The EU Blue Card is issued for an initial term of validity of one year, renewable for successive periods of two years. The renewal of the EU Blue Card must be requested by the interested party within 30 days before the expiration of its validity.
Under certain conditions, a holder of a residence visa for employment reasons may engage in self-employment activities and vice versa, if the activity for which the residence visa was requested remains the predominant activity.
Foreign nationals may engage in the following self-employment activities in Portugal:
- They may be directors of companies (that is, members of boards).
- They may pursue freelance or other professional activities.
In both cases, foreign nationals must obtain a residence visa.
Resident authorizations
Within four months after arrival in Portugal with the proper visa, a non-EU foreign employee must request a temporary residence authorization (autorização de residência).
A simplified registration process applies to non-EU citizens entering Portugal for short-term reasons (business or tourism).
Family and personal considerations
Family members. Family members who accompany a non-EU foreign national to Portugal or wish to join a foreign national in Portugal must request special visas from the Portuguese consulate in their last country of residence. These visas (visto de residência para efeitos de reagrupamento familiar) allow family members to work in Portugal after the relative residence permit for family purpose is obtained (see below).
After the competent consulate abroad issues the visa, within four months after their arrival in Portugal, family members accompanying a foreign national must request their residence authorizations (autorização de residência para reagrupamento).
The rejoining procedure (reagrupamento familiar) can be favorable for family members who legally entered Portugal and hold valid residence permits.
Applications for family reasons residence permits can made for children up to 18 years old.
Driver’s permits. Foreign nationals may drive legally in Portugal using their home-country driver’s licenses if they also possess international driver’s licenses. If the individual resides in Portugal, he or she should carefully investigate if he or she may continue to drive legally without any action (specific rules apply depending on the country that issued the driver’s license). Portugal has driver’s license reciprocity with all EU member countries and certain non-EU countries, including, for example, with the United States.
To obtain a Portuguese driver’s license, foreign nationals must take a driver education course, undergo written, physical and medical examinations, and register with the Portuguese resident population records.