Steps Involved in the Portuguese VAT Application Process

When starting a business in Portugal, understanding the legal framework is crucial for long-term success. Portugal’s business laws are friendly to foreign entrepreneurs, but there are specific legal requirements to follow. The first step is deciding on the business structure that best suits your needs. Limited liability companies (LDA) are the most common, but you may also consider a sole proprietorship or a public limited company (SA) depending on the nature and scale of your business.

Once you’ve chosen your business structure, registering your company with the Portuguese Commercial Registry (Conservatória do Registo Comercial) is essential. You’ll need to provide your business plan, proof of identity, and a tax identification number (NIF). Additionally, registering for social security and ensuring that your business complies with health and safety regulations are necessary steps.

Portugal also requires foreign business owners to appoint a Portuguese representative to handle legal matters. A notary will be required to certify documents, and you’ll need to open a local business bank account. It’s also important to familiarize yourself with Portuguese labor laws if you plan on hiring employees.

VAT reporting in Portugal