Category: Business Setup

Starting in early 2026, the Portuguese Electronic Passport (PEP) will have a validity period of ten years at the beginning of 2026, instead of the current five years.

 

Reasons such as the short period of validity and the existence of “high quality” counterfeits of the current PEP model led the Portuguese Government by doubling the passport’s validity,

 

This extension is part of a new measures to reduce bureaucracy announced by the Portuguese government, with the aim of promoting the “standardization, simplification and digitalization of public services, reaching more and more citizens and companies”.

Due to “the existence of evidence of high-quality forgeries of the current Portuguese Electronic Passport (PEP) model, which represent serious security and control flaws”, and given that the “limited period of five years requires frequent renewals by citizens”, the Portuguese Government decided to proceed with the extension, will be implemented within the first three months of 2026.

 

Despite the change for adults, passports issued to minors will continue to have a five year validity period, aligning with practices in most Schengen area countries.

 

OportoAccounting also helps foreign companies and clients to assist with our exceptional law and regulations, ensuring compliance and seamless administrative support.

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The new measure will take effect on August 1, 2024.

The Republic President of Portugal has promulgated a government diploma that allows young people up to the age of 35 to be exempt from paying the Municipal Property Transfer Tax (IMT) and Stamp Tax (IS) when purchasing their own permanent house.

 

This measure applies exclusively to the purchase of the first home of both owners, it is also restricted to the purchase of urban buildings or autonomous fractions of urban buildings intended exclusively for personal and permanent housing, leaving out the acquisition of land for construction.

The diploma authored by the Portuguese Government provides full exemption for houses worth up to the4 th IMT bracket meaning up to €316,772. To be eligible, young buyers must also not have been considered dependents for tax purposes in the year of the home purchase.

At OportoAccounting we provide to foreign individuals and companies, professional services such as annual compliance of tax filling as well banking assistance, helping you out with Portuguese law and regulations.

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The Portuguese government plans to reintroduce tax incentives for non-habitual residents as part of a broader economic stimulus package. This initiative aims to support companies and the economy, being the focus to attract foreign professionals by offering a fixed rate of 20% income tax rate on salaries and professional income, excluding dividends, capital gains, and pensions, according to Miranda Sarmento, an economist.

Portuguese Finance Minister revealed that this measure is designed to high valueadded Professionals to the country as part of a package of measures aimed to support economy growth. The reintroduction of the non-habitual resident regime is expected to play a key role in this strategy.

Additionally, the government will present gradual reduction measures to stimulate the economy, including a reduction in corporate income tax reducing it by two percentage points per year, up until it reaches 15%. This comprehensive package demonstrates the government’s commitment to fostering a more attractive business environment.

OportoAccounting, an accounting and payroll firm in Portugal can assist you by providing additional information on the new expected NHR tax program.

As an English-speaking accounting and payroll firm in Portugal, Oporto Accounting, observes that Portugal has been ranked 15th best country for expats in Expat Insider 2024 ranking Which evaluates the best countries for people living abroad.

This annual survey ranking, compiled by InterNations since 2014, assesses 53 countries worldwide based on various factors including quality of life, ease of integration, personal finance, and more, to provide an in-depth analysis of the best destinations for people living abroad.

Portugal continues to excel performances in specific areas: the quality of life indexes (7th place), personal finances (13th), and ease of integration (15th) continue to perform well for Portugal.

The Expat Insider 2024 survey included 12,000 people representing 175 nationalities participed, offering a broad perspective on expatriate experiences across the globe.

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Portugal is becoming an attractive destination for investors, with significant opportunities in key economic sectors, according to the “Structural Trends Shaping Portugal’s Economy and Growth” report commissioned by Euronext. The report also highlights Portugal as “the country is positioning itself as a center for technological innovation and startups”.

 

“This initiative not only reconnects stakeholders but also catalyzes new collaborations and investments,” emphasizes Miguel Athayde Marques, Chairman of the Board of AEM.
Euronext’s report identifies five promising areas for investment, based on the structural trends that are shaping the national economy:

• Health: representing 11% of GDP, a percentage higher than the OECD average. Among offers opportunities in biotechnology startups, geriatric care, and medical tourism.

• Energy: Portugal is leading in renewable energy investments, particularly in wind and solar projects, green hydrogen, and lithium.

• Real estate and tourism: These sectors are “going through a period of prosperity”, experiencing substantial growth due to strategic location, quality of life, and competitive real estate prices.

• Agriculture and Forestry: With a 45% growth in exports over the past four years, opportunities lie in advanced agricultural technologies and high-value products like wine, olive oil, and fruits.

• Infrastructure: Portugal’s geographical location is ideal for investment in transport and logistics, with future investments identified in rail, ports, airports, and water infrastructure.

 

OportoAccounting offers to its clients a large range of consulting, accounting and payroll solutions for foreign companies that want to incorporate in Portugal.
www.oportoaccounting.com

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Minister Mário Centeno, Portugal’s former finance minister, has signed a landmark protocol to avoid double taxation, significantly impacting emigrated taxpayers. This protocol, involving agreements with multiple countries across various continents, aims to prevent individuals from paying taxes on the same income in two different nations.

The primary objective of these agreements is to eliminate the financial burden on emigrated taxpayers who often find themselves liable for taxes in both their country of residence and their home country. By addressing this issue, the protocol seeks to promote fair taxation and ensure that income is only taxed once, thereby reducing financial stress on taxpayers and fostering a more favorable economic environment.

Negotiations for this protocol began last year and have progressed constructively, leading to a comprehensive text that addresses Portugal’s primary concerns. In a statement to the press, Centeno emphasized that the protocol focuses on combating tax evasion and eliminating double taxation on income taxes. This, he noted, will deepen economic and commercial bilateral relations, providing a robust framework for cooperation between Portugal and its international partners. And highlighted the importance of such agreements in strengthening the economic ties between Portugal and other countries.

The successful conclusion of these negotiations marks a significant step towards more equitable and efficient tax systems, reflecting Portugal’s commitment to fostering international cooperation and economic growth.

OportoAccounting also helps foreign companies to assist with our exceptional banking assistance, and we conduct regular tax efficiency reviews throughout the financial year, ensuring that your business is being run in the most tax efficient way and it’s complying with the Portuguese law and regulations, including helping to set up a company in Portugal,
OportoAccounting.com

The Executive Vice-President of the European Commission, Valdis Dombrovskis, commended Portugal for its “outstanding economic performance” during a press conference following the presentation of the European Semester spring package. This latest assessment from Brussels has resulted in Portugal being removed from the economic vulnerability monitoring mechanism it had been under for more than a decade.

 

Stated Dombrovskis “First of all, congratulations to Portugal for the remarkable economic performance in addressing its imbalances,”. He further noted that the conclusion from the European Commission is that Portugal “no longer faces macroeconomic imbalances.” This marks a significant milestone for the country, reflecting its progress in achieving economic stability.

Dombrovskis attributed this positive development not only to various factors but also to Portugal’s strong fiscal performance. The country has been showcasing budget surpluses, a rarity among EU nations. Additionally, the commissioner highlighted the “rapid fall” in the public debt-to-GDP ratio. According to Brussels forecasts, this ratio is expected to decrease to 91.9% by 2025, indicating substantial fiscal improvement.

 

Despite these achievements, Dombrovskis urged Portugal to accelerate the implementation of the Recovery and Resilience Plan (RRP). He emphasized that this is an “important topic” for the Commission, aiming to address some of the delays that have been encountered. The RRP is crucial for maintaining the momentum of economic recovery and ensuring long-term resilience.

 

The European Commission’s assessment period spans from 2023 to May 2024, offering a comprehensive view of Portugal’s economic landscape. This period has witnessed significant advancements, underscoring the effectiveness of the country’s economic policies and reforms.

 

Overall, Portugal’s exit from the economic vulnerability monitoring mechanism and its strong fiscal indicators are promising signs for the country’s future economic prospects. The emphasis now shifts to sustaining this progress through continued implementation of strategic initiatives like the RRP.

 

OportoAccounting offers expert accounting and payroll services, and specializes in submitting applications for the Recovery and Resilience Plan (RRP).

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The EUPIO, based in Alicante, is a European institution tasked with managing intellectual property at the EU level. They have launched their reimbursement program for 2024, along with the issuance of vouchers for trademark registration.

These vouchers are designed to assist in covering a portion of the fees associated with trademark registration at the EU level, offering reimbursement of up to 75% of the registration costs.

For further information and assistance, please feel free to reach out to us.

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