Portugal is a beautiful country, and more and more freelancers are seeking to work in Portugal for numerous reasons. Not only do they have beautiful nature, but they also have great prices and tax benefits for foreigners.
To start freelancing in Portugal, you’ll need a work permit or a visa, and then you can register as a freelancer. Though be aware as a freelancer, you’ll have to provide documents to the Portuguese government, and everything happens physically.
With a work permit, you’re now ready to obtain a NIF(personal identification number), bank account, certificate of residency, and NISS(social security number), and then you can start working. I worked a year in Portugal as a freelancer, and even though the government can be slow at times, you’ll get used to it and know your way around it. Let’s get into it.
How To Register As A Freelancer In Portugal
Before you can start freelancing in Portugal, you need a set of “documents” in order. And you really need to have patience with the Portuguese system. It works, but it’s super slow.
First, you’ll have to acquire a Numero de Identificacao Fiscal (NIF). This is an identification number on you for your taxes, for instance. You acquire this from the tax authorities. It doesn’t cost you anything but your time to acquire. All you’ll need is your passport. You can also acquire a NIF online here.
Next up, you’ll have to acquire a bank account. You need an IBAN number, which must be a Portuguese bank. Portuguese purely use IBAN. They don’t have local bank account numbers. You can go to any bank you wish, but some banks might have different requirements, and not all banks are free to use in Portugal.
As the third document, you’ll need a certificate of residency. Now this certificate is what you need to be able to work and live in Portugal. However, you can’t get this before you have your NIF, as you’ll have to provide your NIF. You can get your certificate of residency at your nearest Junta de Freguesia.
The last document you’ll need is a social security number(NISS). This is another identification number for all your activities in Portugal. You need to start this immediately, as this is a lengthy process. This doesn’t stop you from freelancing in Portugal, but you might get in trouble in the long run if you don’t acquire a NISS. You get this at the social security office, and you’ll have to book an appointment. Bring your password, NIG and certificate of residency.
With these 4 things, you’re now ready to start acquiring clients and making a living in Portugal. Personally, I enjoyed living in Amoreiras, Lisbon. But you’ll have to try some different places to find your favourite spot.
If you have the funds, hire a lawyer to help you with this. There are a lot of tax benefits to get as well, and a lawyer can set you up for around EUR 2000. Your investment is quickly returned if you get a 0% tax rate or even a 20% tax rate.
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Benefits Of Freelancing In Portugal
Portugal has recently opened up to make it easy to start as a freelancer. If you’re from outside Europe, it does require a bit extra work, and some processes might be slower. But if you’re from Europe, there are no excuses. Just get started.
The living cost in Portugal has increased recently, but compared to other European countries, it’s still super low, so you’ll be able to make a fine living and enjoy the beautiful culture, restaurants and scenery. Remember to get out on weekends, don’t do like me and work 7 days a week. There is so much to explore in Portugal.
You might have to lower your hourly rate and project prices compared to other countries, but in return, you can apply for tax exemptions or a flat 20 percent tax rate which will last for 10 years. It’s super lucrative.
How To Send Invoices As A Freelancer In Portugal
To send invoices in Portugal, you can either use an online platform the Portuguese government has approved or send them out manually as a PDF file you’ve made in Word or Google Docs.
It’s super essential all your invoices contain the following:
- Name and address of you
- Name and address of the receiver
- Tax identification on you
- Tax identification on the receiver
- Description of everything done
- Subtotal
- VAT
- Total
- Invoice date
- Invoice number
If you’ve sent an invoice before, this is super basic and applies to almost any country. Whether you’re below the minimum threshold income or not, you’ll have to create an invoice. Both are for your own bookkeeping, but your clients require invoices for their bookkeeping.
Suppose you want a more elaborate article on how to invoice as a freelancer. Then watch my step-by-step guide on how to invoice as a freelancer.
How To Do Taxes As A Freelancer In Portugal
When you start to make a living in Portugal, you’ll have to pay income tax. Depending on how much you earn, the more or less you’ll have to pay in taxes as well.
All taxes are handled manually, so you’ll also need to learn to do this. You can hire a bookkeeper to help you, maybe teach you how to do it, or always take care of it.
I hired a bookkeeper, and it ended up costing just shy of EUR 1000 per year, so it was well worth it.
This is probably irrelevant to you, but the lowest tax percentage is 14,5%. This is if you earn less than 7116 EUR per year. And then it goes up from there.
This is how the tax rates are for 2023.
| Income | Tax percentage |
|---|---|
| up to €7,479 | 14.5% |
| €7,480–€11,284 | 23% |
| €11,285-€15,992 | 26.5% |
| €15,993-€20,700 | 28.5% |
| €20,701-€26,355 | 35% |
| €26,356-€38,632 | 37% |
| €38,633-€50,483 | 43.5% |
| €50,484-€78,834 | 45% |
| €78,835+ | 48% |
Conclusion
So don’t be scared of starting to freelance in Portugal. It’s super easy to get started with these steps, and help is everywhere in Portugal.
If you need an office space, then I can recommend Leap. They’re super flexible and do very good prices. They both have dedicated offices and open office space.
If you want to take a look at the neighbour country, Spain. Then I’ve made a guide on how you get started freelancing in Spain.
Remember to get started on the 4 documents as fast as possible, and you don’t want to look back after a year and not have all 4 documents, as this might create some trouble for you.
But when you’re set up, it’s time to acquire clients. I’ve made a step-by-step guide on getting clients as a freelancer.
FAQ
Can I freelance in Portugal?
You absolutely can, and it’s super easy if you’re from a European country. You just need to move there and register as a freelancer, and then you can obtain a NIF, NISS and a bank account. Remember, the government needs various different documents, and everything is physical.
Do freelancers pay tax in Portugal?
Yes, they do, but it depends on how you’ve set up yourself in Portugal. Most freelancers pay income tax rather than corporate tax. If you’ve set up a company, then you’ll pay corporate tax.
Do freelancers pay VAT in Portugal?
Yes, they do, just like many other countries. You’ll have to register and pay for your VAT in Portugal. This works like in any other regular European country.
