10 GREAT REASONS TO INVEST IN PORTUGAL

Money never stops, even at the start of silly season. So if you're thinking about the destination of your next investment why not take a few minutes to consider Portugal? Here are 10 great reasons to do so.

Company incorporation

1.- Fast incorporation – just one day is needed;

2.- Share capital as low as one euro per shareholder;

3.- Minimum number of shareholders and directors is one.

Tax reasons

1.- Rate of 23% in Corporate Income Tax and going down;

2.- Smes benefit from a reduced rate of 17% on the first € 15,000 of tax base;

3.- The non-habitual residency scheme exempts qualified individuals from taxation in Portugal of active or passive foreign sourced income; Portuguese income is taxed at a flat rate of just 20%.

Hot property market

1.- Low prices on attractive property make for great deals;

2.- Investor/ golden visa opportunity for foreign investors who buy property for just € 500,000.

Investment hub

1.- Easier access to other Portuguese-speaking markets such as Brazil, Angola or Mozambique;

2.- Easier access to China via Portugal's former colony Macao.

CORPORATE TAX: GOOD NEWS FROM PORTUGAL (III)

We conclude our three-part series on the corporate tax reform in Portugal with other relevant issues that round-off a compelling effort. If there is one fault to be signaled is that the reform didn't go as far as the initial white paper had foreseen. Nevertheless, its effects are hoped to be far-reaching and turn Portugal into a tax-friendly destination for international investors.

5.- Capital gains: also exempt if the participations meet the same conditions as per inbound dividends (see our last post);

6.- Tax deduction when reinvesting profits: smes that reinvest their profits will qualify for a 10% deduction.

7.- Patent box: only 50% of income derived from licensing patents or industrial designs will be taxed as long as four conditions are met:

1. IP rights must be the result of R&D activities executed by or contracted by the company;
2. The licensee uses the IP rights in a commercial, industrial or agricultural activity;
3. The results of use of IP rights by the licensee must not materialize in the delivery of goods or rendering of services which may be tax-deductible for the licensor;
4. The licensee is not resident in a tax haven or offshore territory.

8.- Income from permanent establishments: Portuguese companies with permanent establishments may choose not to include said income as long as:

1. The permanent establishment is subject to corporate tax akin to Portuguese IRC. When it is domiciled in a territory with a DTT the local corporate tax rate should be at least 60% of the 23% rate;
2. The permanent establishment is not resident in a tax haven or offshore territory.

9.- Less red tape: the number of procedures associated nowadays with preparing, reporting and filing corporate tax is 68. The reform will cut over 20 procedures.

CORPORATE TAX: GOOD NEWS FROM PORTUGAL (II)

For our second post on the recent reform on corporate tax in Portugal we take a look at inbound and outbound dividends. This is undoubtedly one of the key aspects of the reform and repositions Portugal as a great investment hub.

4.- Participation exemption: all inbound and outbound dividends will be tax exempt provided that the following conditions are met:

For inbound dividends:

1. A minimum participation of 5% is required;
2. The participation must be held uninterruptedly for 24 months prior to distribution of dividends;
3. The parent company must not be subject to tax transparency regime;
4. The subsidiary must be subject to corporate tax as per Directive 2011/96/UE, of November 30, or to tax akin to Portuguese IRC* provided that the rate is at least 60% of the 23% rate;
5. The subsidiary must not be domiciled in a tax haven or offshore territory as defined by the Portuguese Government.

For outbound dividends:

1. The parent company must be domiciled in an EU/ EEA country or one that has a DTT with Portugal;
2. The parent company must be subject to corporate tax akin to Portuguese IRC. When the parent company is domiciled in a territory with a DTT the local corporate tax rate should be at least 60% of the 23% rate;
3. The parent company must hold at least a participation of 5%;
4. The participation must be held uninterruptedly for a period of 24 months prior to distribution.

Dividends paid from resident entities to branches in the EU/ EEA will also benefit from this regime as long as conditions a) to c) are met. 

*IRC or Imposto sobre o Rendimento das Pessoas Colectivas, Portuguese Corporate Tax. 

CORPORATE TAX: GOOD NEWS FROM PORTUGAL (I)

While Portugal has never been in the tax-friendly group of countries this might change drastically thanks to the reform of its corporate tax legislation which was recently passed. Portugal now seeks to become a hub for international companies, specially those with strong ties with Portuguese-speaking countries on the rise such as Brazil, Angola or Mozambique. In this next series of posts we’ll take a brief look on what all the good news is about.

1.- Corporate tax rate: the general rate now stands at 25% but it has been lowered to 23% in 2014, and is expected to be cut even further: an extra 2% in 2015 and another 2% to 4% in 2016. So at the end of the line the rate could be 17%. 

2.- Intermediate rate for smes: from this year small and medium enterprises will benefit from a special intermediate rate of 17% for the first taxable € 15,000. 

3.- Tax loss carryforwards: tax losses can be set-off for a 12-year period. However, compensation for each period can only go as far as 70% of taxable profits.

A FEW FACTS ON FRANCHISING IN PORTUGAL (II)

Following our last post, here are a few more facts to round off the picture on franchising in Portugal:

1) 44% of all franchises are based in Lisbon and 24% in Oporto; Setúbal (5%), Aveiro (4%) and Braga (4%) complete the top 5.

2) The franchise sector as a whole represents 3.1% of Portuguese GDP or € 5,297 million.

3) The total number of establishments has slightly decreased from 12,014 in 2010 to 11,760 in 2011, and the total number of employees has gone down to 70,151 or 4% less. 

All in all, and despite the severe crisis sustained by the country, the franchise sector has performed remarkably well. So when the time comes to make their next move franchisors should think about Portugal and see what it has to offer. 

FAST TRACK RESIDENCE PERMIT IN PORTUGAL FOR QUALIFIED INVESTORS

As from October 8, qualified investors can access a fast track procedure when applying for a residence permit in Portugal.  One of the three following conditions must be met prior to applying for the permit:

a) Minimum capital investment of € 1,000,000;

b) Creation of at least 30 jobs;

c) Acquisition of real estate for a minumum of € 500,000 (with no liens or encumbrances).

The condition must be maintained for a minimum of 5 years. For more information please contact our Lisbon office. 

HOW TO INVEST IN PORTUGAL

When it comes to investing in Portugal, choosing the right vehicle is key to the success of the investment. The two most common options are the branch or a Lda (private limited company/ LLC). Tax issues or protection of the parent company may determine which one is the best choice. Other criteria such as minimum share capital are not as relevant anymore since Ldas can now be incorporated with as little as € 1 per shareholder. 

Another interesting feature is that Portugal has striven to cut back on red tape in the past years and long gone are the days of endless paperwork. There is no limitation on foreign shareholders or directors, the only requisite being a Portuguese tax id number, which is fairly easy to obtain. 

For more information on how to start your business in Portugal please contact our Lisbon office.

COMPANY INCORPORATION IN PORTUGAL (III)

We conclude our brief series on the setting up of companies in Portugal with a few ideas on the necessary formalities investors have to go through. Fortunately, the days of endless red tape are well behind us and lawyers can now incorporate companies on-line, swiftly and with less expense.

When the company has been duly registered with the Companies House, it will then have to be registered with some other institutions as well, namely the Revenue Service, Social Security and Labour Inspection. It is worth noting that the opening of a bank account is a must, as the company will only be registered with the Revenue Service if it has one.

When these main formalities are behind us, the fun begins and we can start working with our brand new Portuguese company. As always, we're happy to hear your comments and requests.

COMPANY INCORPORATION IN PORTUGAL (II)

Another key element when incoportating a company in Portugal is share capital. Thanks to recent business-firendly legislation, it is now possible to incorporate a private limited company/ LLC with as little as € 1 per shareholder. Which brings us to another point. How many shareholders must a Portuguese company have? A private limited company/ LLC should have at least 1 shareholder.

On the other hand, public limited companies/ corporations should have a minimum share capital of € 50,000 and 5 shareholders. With regard to directors, both types of companies shoud at least have one, although public limited companies/ corporations require a minimum of 2 if its share capital is in excess of € 200.000.

HOLDINGS EM ESPANHA: ESTRATEGIA E INVESTIMENTO (III)

No post anterior vimos as principais vantagens das holdings em Espanha. A seguir analisaremos os requisitos para nos beneficiarmos delas. Em principio, deveremos atender a três factos fundamentais:

1) Um investimento mínimo da ETVE nas filiais de 5% (directo ou indirecto) ou de 6 milhões de euros, mantido durante um ano pelo menos;

2) As filiais devem desenvolver uma actividade predominantemente industrial ou comercial. Não obstante, também podem desenvolver actividades financeiras quando se realizem em favor de residentes no mesmo país que o da filial, se usarem os seus próprios meios materiais e pessoais.

3) As filiais devem estar sujeitas a um imposto análogo ao IRC espanhol.

HOLDINGS EM ESPANHA: ESTRATEGIA E INVESTIMENTO (II)

Por que ter então una holding em Espanha? Que vantagens traz a holding espanhola? Como motivos principais do interesse que suscitam entre os investidores podemos apontar:

• Facilidade de constituição e manutenção;
•  Objecto social que pode incluir outras actividades além da mera detenção e gestão dos valores;
• Tratados de dupla imposição assinados com 70 países, com especial destaque para os países europeus e do continente americano;
• Isenção fiscal no caso de dividendos, participações em lucros e mais-valias;
• Dividendos distribuídos a sócios não residentes não estão sujeitos a retenção;
• As mais-valias derivadas de venda da participação na ETVE não estão sujeitas a imposto;
• Compensação dos prejuízos fiscais pela actividade holding com as receitas obtidas mediante outras actividades;
• Podem formar parte de um grupo que siga o regime de consolidação fiscal.

PORTUGAL - PRESUPUESTOS GENERALES DEL ESTADO 2012 (II)

Seguimos desgranando algunas de las medidas más importantes en la propuesta de los Presupuestos Generales del Estado portugués para el año 2012:

· IRC (Impuesto de Sociedades): eliminación del tipo del 12,5% para bases imponibles hasta 12.500 euros; subida de la derrama (impuesto municipal) del 2,5% al 3% para los beneficios tributables de € 1.5 millones a € 10 millones; subida al 5% para beneficios tributables superiores a € 10 millones.

· Subidas de IVA: del 6% al 13%: agua mineral; del 6% al 23% espectáculos y pruebas deportivas, refrigerantes, bebidas y postres lácteos, yogures de soja y patata fresca pelada; del 13% al 23%: conservas de frutas y de productos hortícolas, margarina de origen vegetal o animal, máquinas y equipos para la captación y aprovechamiento de la energía solar; restauración; productos a base de carne, pescado, verduras, pasta rellena, pizza, bocadillos y sopas; café verde o crudo, torrado, en grano o polvo; frutas y frutos secos, con o sin cáscara.

· IRS (IRPF): el valor diario del subsidio de alimentación exento de tributación baja de € 6,41 a € 5,55.

HOLDINGS EM ESPANHA: ESTRATEGIA E INVESTIMENTO (I)

O que têm em comum Starbucks, Repsol, Telefónica, Vodafone ou American Express? Além do seu carácter de multinacional, todas constituíram uma holding em Espanha como parte da sua estratégia de internacionalização.
Com efeito, as holdings espanholas, chamadas entidades de tenencia de valores extranjeros (ETVE), revelaram-se como um instrumento atractivo e competitivo na altura de planificar investimentos no exterior.

Cabe dizer, em primeiro lugar, que a ETVE não conforma um tipo específico de sociedade, mas tanto sociedade anónima como a sociedade por quotas podem constituir-se como holdings. Nesse sentido, e para as sociedades por quotas, basta um capital social mínimo de € 3.000. As participações sociais serão sempre nominativas.

PORTUGAL - Prespuestos Generales del Estado - 2012

Ya han sido aprobadas por el Consejo de Ministros algunas medidas incluidas en el Orçamento de Estado 2012.

Estas medidas son:

• Prolongación del horario de trabajo en 1/2 hora/día durante los próximos 2 años;
• Eliminar las pagas extras de verano y Navidad duante el año 2012 y 2013 a los funcionarios de la Administración Pública así como a los trabajadores de la Empresa Pública siempre y cuando su remuneración sea superior a los 1.000,00€/mes. Si la remuneración se situa entre el salario mínimo interprofesional (485,00€) y los 1.000,00€/mes estos trabajadores estarán sujetos a un tuipo de reducción progresiva, que afectará a un solo subsidio;
• De igual forma se aplica el mismo criterior de la medida anteriormente descrita a los pensionistas por jubilación;
• Quedan exentas de IRS (IRPF español) la mayoría de prestaciones sociales (paro, pensión por enfermedad o maternidad);
• Actualización de las pensiones mínimas;
• Eliminación de las deducciones fiscales en sede de IRS (IRPF español) para los 2 escalones más elevados y el resto verán reducidos los límites existentes.

REFORMAS LABORALES 2011 - PORTUGAL

Ha salido publicada en el día de hoy la Ley 53/2011, de 14 de Octubre, por la que establecen alteraciones en el Código de Trabajo portugués en relación a las compensaciones que recibe el trabajador por cese de contrato:

1.- Se crea una compensación uniforme para todas las formas de cese del contrato de trabajo, con excepción del despido ilícito.

2.- La compensación pasa a 20 días de retribución base y diuturnidades por cada año completo de antigüedad.

3.- Para el pago de las compensaciones se creará un Fundo de Compensação (aún no aprobado). 

El empresario pagará 10 días, mientras que los restantes 10 días serán soportados por este fondo. 

La contribución al fondo se hará a través de la aplicación al empresario de una nueva contribución, un porcentaje de la retribución base y diuturnidades obtenida por el trabajador que no podrá exceder del 1%.

4.- El empresario tiene la obligación de la adhesión al fondo, ya que sino se hará cargo de la totalidad de la compensación.

5.-  Para el cálculo de la compensación el valor diario a computar es el que resulte de dividir por 30 la retribución base mensual y diuturnidades.

El límite máximo al valor de las compensaciones no puede ser superior a 12 veces la retribución base mensual y diuturnidades, con un límite máximo de 240 veces el valor del salario mínimo interprofesional (485,00€).

6.-  Eliminación de la norma que impone que la compensación no sea inferior a 3 meses de retribución.

IMPORTANTE: 

Estas nuevas compensaciones o reducciones a las compensaciones sólo se aplican a los nuevos contratos de trabajo celebrados después de la entrada en vigor de la nueva regulación. Es decir, el 1 de Noviembre de 2011.

HOLDINGS EN ESPAÑA: ESTRATEGIA E INVERSIÓN (III)

En el post anterior vimos las principales ventajas de las holdings en España. A continuación analizaremos los requisitos para beneficiarse de dichas ventajas. En principio, deberemos atender a dos hechos fundamentales:

1) Una inversión mínima de la ETVE en las filiales del 5% (directa o indirecta) o de 6 millones de euros, mantenida durante un año por lo menos;

2) Las filiales deben desarrollar una actividad predominantemente industrial o comercial. No obstante, también pueden desarrollar actividades financieras cuando se realicen a favor de residentes en el mismo país que la filial, siempre y cuando usen sus propios medios materiales y personales.

3) Las filiales deben estar sujetas a un impuesto análogo al impuesto de sociedades.

¿Por qué tener entonces una holding en España? ¿Qué beneficios aporta la holding española? 

Como motivos principales del interés que suscitan entre los inversores podemos apuntar:

1) Facilidad de constitución y mantenimiento;
2) Objeto social que puede acoger otras actividades además de la mera tenencia y gestión de los valores;
3) Tratados de doble imposición firmados con 70 países, con especial mención a los países europeos y del continente americano;
4) Exención fiscal en el caso de dividendos, participaciones en beneficios y plusvalías;
5) Dividendos distribuidos a los socios no residentes no están sujetos a retención;
6) Plusvalías que se deriven de la venta de la participación en la ETVE no están sujetas a impuesto;
7) Compensación de las pérdidas fiscales por la actividad holding con los ingresos obtenidos por medio de otras actividades;
8) Pueden formar parte de un grupo acogido al régimen de consolidación fiscal.

HOLDINGS EN ESPAÑA: ESTRATEGIA E INVERSIÓN (I)

¿Qué tienen en común Starbucks, Repsol, Telefónica, Vodafone o American Express? Además de su carácter de multinacional, todas han constituido una holding en España como parte de su estrategia de internacionalización.

En efecto, las holdings españolas, llamadas entidades de tenencia de valores extranjeros (ETVE), se han revelado como un instrumento atractivo y competitivo a la hora de planificar inversiones en el exterior.

Cabe decir, en primer lugar, que la ETVE no conforma un tipo específico de sociedad, sino que tanto al SA como la SL pueden constituirse como holdings. En este sentido, y para las SL, basta un capital social mínimo de € 3.000. Las participaciones sociales serán siempre nominativas.

CONSTITUCIÓN DE SOCIEDADES EN PORTUGAL

 

 

Según los datos del último barómetro Informa D&B, durante el período abril-agosto se constituyeron 12.442 empresas en Portugal. De ese número, 5.206 cuentan con un capital mínimo inferior a € 5.000, de las cuales 4.032 empresas disponen de una capital inferior a € 1.000, lo que denota un aprovechamiento importante de los recientes cambios en la materia. De hecho el número de empresas constituidas en este período por comparación al año anterior, representa una subida del 21%. Los sectores de telecomunicaciones y servicios son los que más se han beneficiado de la eliminación del requisito del capital mínimo.

SPANISH HOLDINGS: SOUND INVESTMENT STRATEGY (III)

In our last post we discussed some of the advantages of Spanish holding companies. Now the important question is: how does a company’s investments qualify for the holding regime? There are three main requirements:

1) Participation in the holding’s subsidiaries must be of at least 5% or lower if the purchase value is € 6 million. Participations must be held during one year preceding the date in which the dividend is callable.
2) Subsidiaries must have a predominantly commercial or industrial activity. However, they can also carry out financial activities when in favor of residents in the subsidiary’s country, as long as they make use of their own resources.
3) Subsidiaries must be subject to tax similar to Spanish corporate tax.

 

Please feel free to contact us if you have any queries!