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by sergiosgc 3011 days ago
Your first step is to get registered with the Portuguese fiscal authority, social security and health system. You'll have to do that in person, but from then on interactions will all be online. Your best bet is to go to a "Loja do Cidadão" (citizen's shop), where all services are in one place. There's a Loja do Cidadão on major cities.

Then, you'll have a few options. If the remote company has no Portuguese subsidiary, you'll have to operate as an independent contractor (trabalhador independente) or as a one person company (sociedade unipessoal). It's basically the same, except as a company you must have an accountant. As an independent contractor you may have an accountant, or you may choose a simplified accounting model where you don't declare expenses, and your profit margin is estimated by the fiscal authority.

Income tax is progressive. You should be able to read the brackets here: https://economiafinancas.com/2017/escaloes-irs-2018/

You declare your income in May, and pay income tax in July/August.

Social security is a fixed rate: 29.6%. It is a mandatory retirement savings, and provides disability income should you require it. You pay social security quarterly or monthly.

Access to the national health service is not dependent on any tax or regular payment. You don't need health insurance.

As an independent contractor, you would pay VAT, but cross-border transactions are exempt, so your VAT is probably zero (check this with an accountant; EU's rules on cross border transactions are in flux).

References:

https://www.portaldocidadao.pt/

http://www.portaldasfinancas.gov.pt/

3 comments

That's a pretty high social security rate. I am in a similar position to OP, but in Spain. My overall tax burden (including social security) is around 30% which is not bad at all. So, if you're flexible and just looking for something new, I definitely recommend looking at Spain.
I definitely recommend looking at Spain

I'm in Catalonia, Spain (for a few more weeks) and do not recommend. I don't know what you are making, but I am also an Autonomo, and I'm being royally fucked on social insurance and taxes. My tax and SI bill for this year will be around 60%, and fuck that. And yes, I have tried different accountants. Essentially, the tax department decided that a lot of my expenses are not allowable, and because I have bank accounts in other EU countries as well as Spain, they decided that I am "probably hiding something" (their words). I can go and spend a lot of money on lawyers, or I can just pack up and leave.

Combined with the bullshit Catalan independence movement and accompanying social and economic instability, generally unfriendly Catalans, terrible quality of food (essentially salt, with a hint of whatever it claims to be on the package), and the "we will bill you whatever the fuck we want, good luck clawing your money back" utilities (literally opened a 400 EUR bill from the phone company 10 minutes ago), I am totally done with this place.

I have lived in many countries, and all places have challenges and ups and downs. This place, however, is the pits.

Head to Rwanda.
The equivalent social security rate in spain is 29.8%: http://www.seg-social.es/Internet_1/Trabajadores/CotizacionR...

Spain does the same thing as Portugal, for company workers, where they "hide" part of the social security payment from payment receipts. Companies pay 23.6% and the worker 4.7%. Only the latter appears in the salary receipt, the other is a company expense.

The above was for being self employed
As was my quote of 29.8% (trabajadores autónomos). I posted the link for this exact section.
I'm not going to claim to understand everything on that page (spanish taxes are complicated!), but nearly all autónomos pay the minimal amount payable, which is 275 euros/month. You can contribute more if you want to get more state pension, don't I don't believe many do.

Edit - it's 29.3% of the base mínima de autónomos - which is about 920 euros a month. Now, I honestly have no idea what that actually means, but it means you pay about 270 euros regardless of what you earn (it's a stupid system that benefits the well-off).

This is slightly different as he is looking to apply for non-habitiual status. This is quite a bit more complex and I would not do it without good professional advice. The major accounting firms have set up a production line, and I really would talk to them. These are PWC, Deloitte, etc. I took some very bad advice when I moved to Portugal, and it took years to sort out. Be very careful in who you take advice from. If you file one bit of paper in the wrong order it can take years to solve.
The social security bit is very important to highlight. Especially if he can't recover the payments once he leaves the company. He is putting over 50% of his pay check to the Portuguese authorities.

To the OP: Did you visit Portugal? Why do you want to move there?

It is not a third-world dump hole but it is a not a first world class country either.

> The social security bit is very important to highlight. Especially if he can't recover the payments once he leaves the company. He is putting over 50% of his pay check to the Portuguese authorities.

Within the EU you can transfer social security between countries. If he doesn't he will be entitled to retirement income when reaching retirement age. In no condition would he forfeit these payments.

> It is not a third-world dump hole but it is a not a first world class country either.

One of the best health services in Europe, one of the lowest crime rates in the world, lots of english-speaking nationals, and gorgeous weather. You won't find the hubbub of very large cities such as NY, Paris, or London, but then again you might not miss the hubbub. It's definitely first-world.

> It is not a third-world dump hole but it is a not a first world class country either.

I'd be interested in hearing what it is that you find in first-world countries that you don't find in Lisbon. Genuine question.